A 6th Difference Between ACOs and “AC-Like” Arrangements

Last week I wrote about five key differences between formal ACOs (mainly care providers contracting with Medicare)  and informal Accountable Care-Like (AC-Like) arrangements between care providers and commercial health plans.

  1. Transaction costs
  2. Timing
  3. Incrementalism
  4. Flexibility
  5. Capital cost

There’s an important  6th  difference worth noting:

Visibility

Elephants

Formal ACOs will be visible from miles away — think elephants on the Serengeti.

An ACO that wants to contract with Medicare must establish itself as a corporation. The Medicare ACO models have substantial disclosure and reporting requirements. We won’t know everything about formal ACOs, but we will know a lot. ACOs cannot hide.

Chameleon

AC-Like arrangements between care providers and commercial payers could be much more difficult to spot and categorize — think chameleons in the jungle.  

These informal AC-Like arrangements can be made through private contracts — therefore not necessarily publicly identifable. Some AC-Like arrangements have been visible and have been announced with press releases and confetti — but it’s also forseeable that there will be circumstances where deals will be quietly negotiated without fanfare.

Chameleons can choose to blend in, or they can change their colors.

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