The Accountable Care Act: Benefits and Challenges


The Accountable Care Act (ACA) is a bill passed by the congress in America in 2010. After the signing of the act was made, it came into operation early 2011. President Obama is one of the key figures that proposed the law. The act seeks to provide health insurance to all people of America to ensure they access health care. The reason that compelled the adoption of this act was the ever-increasing cost of healthcare in America. Many citizens could not meet the high costs of medical services. With the act, many Americans can now access medical facilities at a low cost. Even though there are some challenges in its implementation and management, the program is conducive in promoting good health to all. The operation of the act is hoped to be extended up to 2019 to ensure affordable health for all.

The Accountable care act/affordable care act of the US was passed for the first time in 2010. The act implemented various changes in the US healthcare systems (Allen, 2013, p. 25). The act facilitated the formation of the Accountable Care Organizations (ACOs) that aimed to reduce the costs of accessing medical care. All individuals under the act should be insured to allow them access medical facilities at a low cost. The law has various clauses concerning important issues on health care. This paper seeks to discuss the various issues concerning the act including its benefits, challenges, and the future of the health care systems of the US. The paper will also delineate on the key features of the act.

The ACA: Its Aims and Benefits

The president of the US signed the Accountable Care Act on March 23 2010. The ACA seeks to put in place compressive reforms concerning health insurance to be implemented in four years time. With the law, various changes are going to be experienced. These changes will be implemented in piecemeal over the four years and beyond until the objectives of attaining universal health services are met. When the bill was signed in 2010, a patient bill of rights was effected. It seeks to protect consumers from abuse by various insurance industries that cover their health care issues. Other cost-free preventive services will also be rolled out in most parts of the US for people to access (Allen, 2013, p. 25). In the year 2011, people who had already applied for Medicare were eligible to access important preventive services without fees. They were also entitled to receive a 50% discount on new drugs that were supplied in these Medicare facilities under the arrangement dubbed “donut hole”.

This year has seen the formation of Accountable Care Organizations (ACO) together with very important programs that can help doctors and other health care providers to work together in advancing the interests of patients by providing better services to patients and those in need of good heath care. It is expected that, by 2014, all people in America will access affordable health insurance services of their choice. Individuals will be able to compare various health plans available in the market on a level playing field. This will be possible with the coming into operation of the new insurance exchanges. Furthermore, tax credits will be availed to low and middle income families while Medicaid program will be extended to those in abject poverty (Hong, & Dimick, 2012, p. 307). The intention of these reforms is to ensure that the American people are able to get insurance and affordable medical care. The programs will continue until the people of America are able to afford good medical care regardless of their status in the society. As such, various benefits are expected on the way to this implementation.

The act encourages the formation of medical homes in the US. These organizations were created in the belief that they could help improve the health care quality besides reducing or slowing the ever-increasing rate of spending in the health care service in America (Burke, 2011. p. 875). These rules were announced on 31 March 2011 by the center of Medicare and Medicaid service (CMS) and ACO provisions as depicted under section 3022 to be implemented (Ronai, 2011, p. 60). According to the act, ACO is set to achieve various goals. One of the goals under the act is to ensure better health to the citizens of America, the poor and rich. Secondly, it is to ensure better care. Practitioners should be qualified to provide good care to patients. The third goal of the act is to ensure that the health care services are accessed at a lower cost. Many American are not able to access good medical care because of high costs involved in the provision of health services. Therefore, the act will ensure that these issues are dealt with and achieved to allow a better health care to the entire nation (Hong, & Dimick, 2012, p. 307). The act further provides guidelines on how communication and coordination between doctors and hospitals can improve the quality of health care given to patients besides helping to reduce the cost charged for the provision of such services.

ACOs: An Overview

Before the act was formed, the government together with informed private health care advocates came together to strike a deal that would allow people to access good medical care at a low cost. These stakeholders were concerned about the costly health care system that denied many Americans access to good medical care. They therefore reached a decision to come up with innovative hospital/ physical relationships or collaborative working environments, ACOs, which would help in improving the care of patients at various health facilities. They therefore recommended the formation of these organizations to help improve the health of the Americans through reduced costs.

How ACOs Work

Under this plan, the health care providers, physician groups, and hospitals are able to access various opportunities. Physicians and hospitals that fall under ACO can get reimbursements under the fee-for-free services model. Medicare provides this reimbursement. Furthermore, all the physician participants are also eligible to receive a bonus or shared-savings if only their ACO meet the cost cutting and quality care structure as provided in the section 3022 of the law (Ballard, 2012, p. 707). In addition, the section allows the centered for Medicare and Medicaid services to manage and coordinate care for the assigned beneficiaries of a certain Medicare facility. It is also required that every accountable care organization enters a three-year agreement with the center for Medicare services that will hold it accountable concerning the quality of services it provides. It will also be held responsible for the cost of patient care and the overall care that it provides to clients including the provision of services such as free-for-service Medicare beneficiaries that the organization is mandated to oversee (Weil, 2012, p. 10).

Furthermore, ACO must conform to the set organizational structure in accordance with the requirement of the center for Medicare services requirement to allow the criteria of section 3022 to be approved. First, the ACO must be willing to be accountable for the cost, quality, and the fee-for-services that has been assigned to it. This accountability is meant to ensure that the organizations perform to the expected level. They must sign an agreement that lasts for a minimum of three years. Thirdly, they must have a formal “legal structure, which provides a framework of the distribution of payments of shared savings to the eligible participants of service providers” (Ballard, 2012, p. 708), as well as suppliers. The ACO should have well-qualified professionals to cater for an average of 5000 beneficiaries. In addition, it should have good leadership and management, which consists of clinical and administrative systems. This leadership is aimed at ensuring that the facilities are well managed and administered to accomplish the objectives set. It must also exhibit that it has the capability to fulfill the patient-centeredness standards as provided by the desk, for instance, the use of personalized concern strategy.

Requirements of the ACO

The ACOs must perform or carry their operations to satisfy the Center for Medicare on quality care and cost cutting performance. To satisfy the requirements, the ACOs should provide a continuum of care to the patients across different settings. They should meet the minimum amount of ambulance that is required besides having post-acute care and inpatient hospital (Ronai, 2011, p. 60). Furthermore, they should have the ability to plan for budgets and provide adequate resources to deliver good care according to the threshold set by the center of Medicare and Medicaid services. In addition, it should demonstrate good performance.

ACO Stakeholders

These include providers, payers, and patients. Providers include physicians, hospitals, and other health care professionals. They may also include “health departments, safety net clinics, social security department, and home care services” (Ballard, 2012, p. 709) based on the capacity of the ACO. These providers need to work or collaborate with one another in their network to ensure that they are beneficial to the population in aligning their incentives to reduce the cost of accessing health care. The payer is the federal government, which pays through Medicare. They help the ACO to provide high quality services at reduced costs. These payers may align together to come up with an incentive or scheme that is able to trigger improvement in the quality of healthcare provided. Patients consist of Medicare beneficiaries (Weil, 2012, p. 11). These may include both uninsured and the homeless.

The operation of this act comes with a good deal of challenges to ACOs. Some of the issues that may lead to potential risks relate to employment contracts and their breaches. The contracts may not conform to the expected standards. They may be breached by the ACO leading to a failure of implementing the required standards. This is likely to cause a problem in the operation of the functions in the health system (Weil, 2012, p. 10). The process of determining which physician applicant should be considered to become ACO may also bring challenges especially with the use of economic credentialing principles. Others include failure to comply with the CMS performance credential, issues relating to the application or use of electronic records, and sometimes government investigations through agencies, which may also cause challenges because they may disrupt the normal functioning of participants in ACO operation hence making it unsustainable.

Challenges facing the ACA

Even though ACOs have the potential of improving the quality of health care services in America by reducing the spending incurred in the health care system, the act has some challenges that the government or any institution with interest should keep in mind or seek to solve. One of the challenges is the lack or inadequate procedures to ensure that the rules regarding the ACO are implemented. This limitation makes it difficult for the implementers to have a clear objective or procedure to follow when implementing it (Ronai, 2011, p. 61). Another challenge is that the start up costs of implementing ACO and the maintenance costs are high. Therefore, the government will be required to increase its level of taxes or look for alternative sources of additional funds to ensure that this becomes a success. The act also faces a big risk if it fails to meet the threshold that it was set up for such as ensuring that ACOs reduce the costs of healthcare. In the circumstance that they do not manage these, they face the risk of being accused of violating antitrust law, for instance, if they provide poor heath services at a low cost (Ronai, 2011, p. 61). However, the US government has come up with a review process that concerns any instances or complains related to antitrust. Another challenge is associated with the introduction of electronic health records. It will require physicians to be trained to use it to avoid making errors. Therefore, this will require many funds to ensure that the act achieves the required goals.

Conclusion/Implications of the act

The act was proposed in good faith. The government and all other stakeholders had a good intention when coming up with this act, which targeted various issues of the health care system. The act aimed at ensuring that the type of health care services provided was of high quality and affordable to the majority of Americans. Even though it has been criticized, it has so far experienced some positive impacts in the sense that many Americans with low income (middle-income category) can access medical care. It has opened a wide opportunity for the majority of the people in America to access good health care (Ronai, 2011, p. 60). However, some challenges that have so far been associated with this plan include challenges of implementation and maintenance of the program, ensuring that ACO provides a service that meets the standards set among other challenges. The accountability care act, also called affordable care act, is the mother of ACOs that have helped in the improvement of health care in America. Under this arrangement, many Americans have an access medical care at a low cost. The medical care act should not be compromised, as it seeks to ensure that the quality of medical care provided is high. Even though ACOs face some challenges, if appropriate measures are undertaken, accountable health care stands out as a program that will ensure that all people in America access good care. This will help in reduction of death rates therefore reducing the costs related to the provision of medical services. The insurance health scheme will cover the expenses of many people who otherwise would have not been able to access the services.

Reference List

Allen, J. (2013). Health Law & Medical Ethics for Healthcare Professionals. Boston: MA: Pearson.

Ballard, J. (2012). Commentaries on accountable care organizations: The Potential of Medicare Accountable Care Organizations to Transform the American Health Care Marketplace: Rhetoric and Reality. Mayo Clinic Proceedings, 87(8), 707- 709.

Burke, T. (2011). Accountable care organizations, Public Health Reports. Public Health Rep, 126(6), 875-878.

Hong, S., & Dimick, J. (2012). Health policy update: making sense of accountable care organizations. Archives Of Surgery, 147(4), 305-307.

Ronai, S. (2011). The Patient Protection and Affordable Care Act’s Accountable Care Organization Program: New Healthcare Disputes and the Increased Need for ADR Services. Dispute Resolution Journal, 66(3), 60-70.

Weil, T. (2012). Accountable care organizations: HMOs by another name?. The Journal of Family Practice, 61(1), 11-23.

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