Since March 2010, my colleagues and I have burned a lot of calories discussing the Patient Protection and Affordability Care Act (ACA) and all the many ways that it can impact healthcare, particularly with those organizations that are responsible for touching the 3 P's (patients, physicians, and payers). I remember speaking about the complexity of the legislation and uncertainties that it created in the market access and reimbursement landscape with a biopharmaceutical client the day after the bill was signed and he said, ?The good news is that we have plenty of time to sort it all out.? That may have been true then, but there sure seems to be a lot of sorting still left to be done.

Based on a lot of the discussions that my colleagues and I have been having over the past 12-18 months with biopharmaceutical manufacturers, there is a range of variability in organizational understanding and preparedness in relation to some of the more impactful components of healthcare reform, particularly around Accountable Care Organizations (ACOs). Beyond the basic understanding of the legislation and the various components, there are a common set of core issues and business questions that many biopharmaceutical manufacturer executives are finding themselves left to deal with as they begin planning for 2014.

  • What is an ACO and how will we as an organization define them? PPACA defines an ACO as ?An organization that agrees to take on responsibility for providing care for a defined population while achieving specified quality objectives and constraining costs.? Organizations will need to ask is this definition adequate for our organization or do we want to define ACOs differently by either narrowing or expanding the parameters based on our strategic objectives, sales goals, and product portfolio.
  • Does my organization want to engage with ACOs? This key question first starts with understanding how these organizations work (or are intended to work) and evaluating what value biopharmaceutical manufacturers can offer these organizations now that they are at risk for patient outcomes. For years, MCOs have been yearning for outcome based clinical endpoints with little to show for their troubles. Now that physicians are serving as the de facto payer, the demands for such outcomes are likely to stay strong, if not ratchet up significantly.
  • How does my organization want to engage with ACOs? This is one of the most frequent discussion points that we have across our client base. Thus far, we are seeing a range of strategies between a fully dedicated ACO sales force to ACOs simply being added to the call list of regionalized Account Managers. Right now there are no right answers other than to say that ACOs must be addressed on some level and it must be done quickly. Because of this rush, we have found that a lot of assumptions and values are being prematurely projected on to ACOs and that short-term triage tactics for 2014 engagement with ACOs, while necessary, should not be substituted for a more measured and step-wise strategic plan that includes a well-defined market segmentation.
  • How do I measure success of my engagement with ACOs? If engagement is the most frequently discussed issue, this is the biggest follow-up discussion point by a country-mile. Now that some manufacturers are implementing their plans, there is a strong push for understanding the return on investment. Prior to implementation, this is likely premature; however stakeholder influence mapping within the individual ACOs will likely play an important role in helping to define success and evaluate ROI for the manufacturer.

With all the uncertainty that continues to exist prior to full implementation in 2014, it feels a little like we are being asked to build the plane while we are trying to fly it. However, taking a moment to carefully consider some of these simple questions along the implementation continuum have helped many of our clients to be more strategically focused in trying to maximize their investments over the long term and avoid wasteful short-sightedness.


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