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Explained: What has changed in the ACO contract?

Explained: What has changed in the ACO contract?
By Léa Legraien Reporter
4 May 2018

In August 2017, NHS England published the first contract for Accountable Care Organisations (ACOs), an integrated care system with full responsibility for all health and care services in an area.

Following a recent Government’s consultationon whether ACO draft regulations ‘delivered the policyobjective of ACOs’, the proposed definitions were changed for greater clarity, as they ‘didn’t accurately reflect the policy intention’, said the Department of Health and Social Care (DHSC).

What is an ACO?

ACOs find their origin in the American Affordable Care Act, with the aim of improving patient care while reducing growth in healthcare costs.

Within the NHS, ACOs will be used as tools to integrate primary care, mental health, social care and hospital services. The idea behind accountable care is to bring different health and care organisations to improve the health of their local population by integrating services and tackling the roots of ill health.

An ACO is not a legal entity but a way for commissioners to ‘allow health and care organisations to formally contract to provide services for a local population in a coordinated way’, according to NHS England.

In other words, an ACO is an organisation, which is awarded a contract to provide health and care services.

What has changed then?

A DHSC spokesperson told Healthcare Leader: ‘The change to integrated service provider contract (ISPC) and integrated service providers (ISPs) only relates to the legal definitions used in draft amendments.

‘Given that the aim of the new ACO contract is to commission integrated health and care services, we have taken the view that within the draft amendments transparency and clarity is best served by maintaining a consistent definition that sets out who may be the commissioners of such a contract on the one part, and what services may be provided under or pursuant to that contract.’

Therefore, the ACO terminology remains and the amendment will not mandate what form an ACO should take or what responsibilities it should have.

What are ISPCs and ISPs?

In 2014/15, 50 vanguard sites were identified to implement five new care of models – to better meet the changing needs of the population – including the multispecialty community provider (MCP) and the integrated primary acute care systems (PACS), also referred to as ISPs.

MCPs and PACS are both types of population-based care models, which focus on integrating care. They differ in scope and sometimes scale.

PACS joins up primary care, community, mental health, social care and hospital services to improve the health and wellbeing of a whole area’s population. A PACS also provides most or all local hospital services.

MCP is a new type of integrated provider organisation, which combines the delivery of primary care and community-based health and care services. In some places, an MCP might provide some services currently provided in a hospital setting.

‘Where these models are formalised through the use of a contract, organisations delivering both the MCP and PACS care models are forms of ACO’, says the DHSC.

Why are ACOs controversial?

The introduction of ACOs in the NHS has generated some fear around the rise in private companies providing health and care services.

According to NHS England guidance, there will be ‘no formal restrictions on who can hold an ACO contract. The British Medical Association (BMA) and other critics argue that ACO then opens the door to non-NHS providers to provide a ‘large healthcare economy’.

The BMA also criticised the lack of clarity and accountability around ACOs and the fact that contractual deals might no be easy to reverse in the short term.

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