ACOs Spell 'Opportunity' for HMEs

WATERLOO, Iowa — Savvy home medical equipment providers can be the "go to" companies in the emerging world of 21st century health care, but they need to be quick to align themselves with newly forming Accountable Care Organizations, an industry analyst said.

"You want to establish that relationship with the ACO before someone else does," advised Alan Morris, director of alternate care programs for Waterloo, Iowa-based VGM.

The reason? ACOs will soon be the new referral sources in town and if you aren't aligned with one or more, you could find yourself shut out of the Medicare business.

Under the Affordable Care Act, physicians, hospitals and other providers can form ACOs that work together to coordinate care for Medicare beneficiaries. Such networks will be expected to improve the health and experience of beneficiaries and reduce the growth rate of health care spending. In return, the networks will share in any savings to the Medicare program, which are anticipated to tally upwards of $430 million over three years.

On Tuesday, CMS unveiled two concepts related to ACOs. Its Pioneer model will be available this summer and is aimed at ACOs that have already begun coordinating care for patients and can utilize alternative payment mechanisms, such as private payers.

In addition, the Advance Payment ACO model will allow certain ACOs participating in the Medicare shared savings program to access their savings up front as a way of covering the costs of infrastructure and staffing. CMS is asking for comments on that idea, and the agency's Innovation Center is offering learning sessions to teach providers about ACOs, as well as ideas for improving care delivery.

At this point, CMS doesn't recognize DME companies as network partners, Morris said, adding that VGM plans to address that in its comments to CMS. Still, there is an opportunity for industry providers to partner with networks and beef up their businesses, he said.

"There are new incentives to keep patients out of the hospital," Morris said of the program. "[ACOs] are going to count on DMEs. DME [companies] are going to have to look at making their businesses more attractive to ACOs. There are new initiatives that we can take to prepare ourselves to be the 'go-to' people."

Morris suggested the following: