Sometime last fall in the Motor City, the green flag dropped and physicians groups and health systems began racing to form accountable care organizations.

One source said there were groups knocking on every provider's door eager to talk about consolidation, cooperation, loose affiliations, mergers, acquisitions, anything to get aligned for what was coming.

Interestingly, once the actual ACO regulations were released by the Centers for Medicaid & Medicare Services on March 30, 2011, the phrase accountable care organization disappeared to be replaced by organized system of care. I was so, so disappointed with the CMS rules it gave me a bellyache, one chief medical officer said. Everyone looked at the regs and said, Never mind, said another.

The providers contacted by HealthLeaders-InterStudy in the Detroit market to a person dissed the ACO rules. They have problems with the way patients are allocated, problems with beneficiary engagement, problems everywhere. And the biggest complaint of all is about federal regulations on meaningful use, which Paul Harkaway, president of the Huron Valley Physicians Association, called, The most misguided federal initiative since the Bay of Pigs.

Nevertheless, here at the beginning of May 2011, at least seven groups of providers in the Detroit region have begun forming groups that can be designated OSCs by Blue Cross Blue Shield of Michigan. They are chasing the 20 percent increase in payment for office visits (evaluation & management) with no downside risk that the Michigan Blue plan is dangling as an incentive for designated OSCs that meet clinical and cost goals. Most of the major hospital systems are in the game through their physician groups: St. John Providence, Henry Ford Health System, Saint Joseph Mercy, the Detroit Medical Center, University of Michigan Medical School and Oakwood Health System. A couple of others are forming with physician groups alone, such as the 2,000-physician Wayne State University Faculty Group combined with Medical Network One, and the 1,600-physician United Physicians group.

We joke about having a little bit of schizophrenia operating the old while developing the new, Bob Hoban, chief strategy officer for St. John Providence Health System, said. But change is clearly coming, and we've got to shift with it.

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