Orlando Health and Florida Blue Create Accountable Care Organization

Thursday, December 12, 2013
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law and Lance O. Leider, J.D., The Health Law Firm

On December 3, 2013, Orlando Health Physician Partners and Florida Blue announced the launch of an accountable care organization (ACO). The purpose of the ACO is to encourage providers to reduce healthcare costs by grouping together and assuming responsibility for the care of a group of beneficiaries. According to a press release, the ACO between Orlando Health and Florida Blue will start January 1, 2014.

To read a press release from Florida Blue on the creation of the ACO, click here.

Orlando Health consists of approximately 500 physicians and eight hospitals in Lake, Seminole and Orange Counties. Orlando Health hospitals include Orlando Regional Medical Center, Dr. P. Phillips Hospital, South Seminole Hospital, South Lake Hospital, Health Central Hospital, Arnold Palmer Hospital for Children, Winnie Palmer Hospital for Women and Babies, and MD Anderson Cancer Center.


What the ACO Could Mean for the Two Companies.


Starting January 1, 2014, Orlando Health doctors will be responsible for increasing the quality of care and reducing medical costs for Florida Blue patients. According to an article in the Orlando Business Journal, if Orlando Health doctors are able to beat targets in quality by reducing readmissions, making sure patients get mammograms and screenings, and slowing down the increase in medical care costs, Orlando Health will get to share in the savings. According to the Orlando Business Journal, companies that have Florida Blue as an insurance carrier may also eventually see lower premiums. However, Orlando Health has no risk if targets are not met.

Click here to read the entire article from the Orlando Business Journal.


Future of ACOs.

As the Centers for Medicare and Medicaid Services (CMS) prepares to designate the next class of accountable care organizations (ACOs), the agency sought the advice and input of the Medicare Payment Advisory Commission (MedPAC) on how to proceed.  MedPAC is an independent Congressional Agency established to advise the U.S. Congress on issues affecting Medicare. Click here to read our previous blog on MedPAC’s suggestions for the next class of ACOs.


Understand an ACO Agreement Before You Sign.

As we see more and more physicians being approached to join or form ACOs, it is crucial to understand exactly what type of arrangement you are getting into.

Many ACO contracts we see are simply for participation as a provider in the organization.  However, some of the contracts we see require that the physician make a financial investment in the ACO or otherwise require that the physician pay a “pro rata” share of any penalty assessed by CMS.

Current ACO participation and recruiting is something akin to the gold rush of the nineteenth century.  Everyone is rushing to stake a claim in fear of being left out.  Be careful about what kind of an agreement you sign and be sure that you understand the long-term consequences of tying your practice to an as-yet unproven model. To read our previous blog on the first year pioneer ACO results, click here.

If you are approached to join an ACO, or are considering signing a participation agreement/contract with one, make sure to read the contract carefully and consult with an experienced healthcare attorney.


Contact Health Law Attorneys Experienced With Healthcare Business Practices.

The Health Law Firm routinely represents physician groups and practices with issues involving establishing, licensing, selling, merging, and intergroup affiliation.  If you are considering establishing an ACO or have been approached to become a participant in one, you can contact The Health Law Firm at (407) 331-6620 or (850) 439-1001 or you can visit our website at www.TheHealthLawFirm.com.


Comments?


Would you consider joining an ACO? Why or why not? Please leave any thoughtful comments below.


Sources:


Health News Florida. “Orlando Health, Florida Blue Form ACO.” Health News Florida. (December 10, 2013). From: http://health.wusf.usf.edu/post/orlando-health-florida-blue-form-aco

Aboraya, Abraham. “How Florida Blue/Orlando Health Deal Could Affect Your Business.” Orlando Business Journal. (December 11, 2013). From: http://www.bizjournals.com/orlando/blog/2013/12/how-the-florida-blue-orlando-health.html?page=all

Kluding, Paul. “Florida Blue and Orlando Health Create Accountable Care Agreement.” Florida Blue. (December 3, 2013). From: http://bit.ly/1bzQR6T


About the Authors: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

Lance O. Leider is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone:  (407) 331-6620.


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12/12/2013

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