# Will the Reach of ACOs Extend to Specialty Care?

> **NIH AHRQ R01** · UNIVERSITY OF MICHIGAN AT ANN ARBOR · 2020 · $321,506

## Abstract

PROJECT SUMMARY
The Patient Protection and Affordable Care Act of 2010 included a variety of payment and delivery system
reforms to curb health spending, the most notable of which was the establishment of Medicare accountable
care organizations (ACOs). Much of the initial focus of ACOs has been on enhanced primary care for
beneficiaries who have multiple chronic conditions; however, there are reasons to believe that ACOs may
benefit other key healthcare sectors where room for improvement exists. Specialty care is one such sector with
major implications for ACOs' shared savings goals, given wide variation in its utilization and expenditures that
account for nearly 50% of all health spending. While ACOs do not explicitly target specialty care, their
emphasis on deeper clinical integration and greater financial stewardship could fundamentally change
specialist referral patterns among primary care physicians (PCPs) and have an impact on specialists' treatment
decisions when the care is of questionable value. Yet ACOs' impact on specialty care could also be limited.
Most Medicare ACO contracts do not encompass specialist practices. Insofar as these providers remain
weakly connected to PCPs accepting shared accountability, ACOs may have little influence on specialty care
utilization and cost efficiency. They may even create perverse incentives that worsen outcomes. In this context,
we propose a study to assess the impact that ACOs have on specialty care delivery. Our proposal has the
following three Specific Aims. Aim 1: To measure the effects of ACOs on PCP-specialist referral
networks. Using national Medicare data, we will identify patients with one of four tracer conditions (ischemic
heart disease, lower extremity joint pain, and newly diagnosed breast or prostate cancer) and the provider
groups that care for them. We will distinguish between groups participating in a Medicare ACO and those that
are not. We will then use network analytical tools to measure specialist referral patterns in these groups before
and after ACO formation. Aim 2: To assess the effects of ACOs on specialists' treatment decisions. Next,
we will calculate utilization rates of high- and low-value diagnostic and therapeutic care processes across the
patient cohorts identified in Aim 1. We will compare these rates among participating and non-participating
provider groups before and after ACO formation. Aim 3: To determine the effects of ACOs on the efficiency
of the treatment episode. Finally, we will determine Medicare payments made during treatment episodes
before and after ACO formation. We will explore potential sources of savings, including component payments
for physician services and hospital and ED care. Findings from our study will be directly relevant to the Agency
for Healthcare Research & Quality's Research Priority Area #3, as they will inform policymakers at Medicare
about the effects of ACOs on specialty care delivery.

## Key facts

- **NIH application ID:** 9916669
- **Project number:** 5R01HS024728-05
- **Recipient organization:** UNIVERSITY OF MICHIGAN AT ANN ARBOR
- **Principal Investigator:** John Malcolm Hollingsworth
- **Activity code:** R01 (R01, R21, SBIR, etc.)
- **Funding institute:** AHRQ
- **Fiscal year:** 2020
- **Award amount:** $321,506
- **Award type:** 5
- **Project period:** 2016-07-01 → 2022-04-30

## Primary source

NIH RePORTER: https://reporter.nih.gov/project-details/9916669

## Citation

> US National Institutes of Health, RePORTER application 9916669, Will the Reach of ACOs Extend to Specialty Care? (5R01HS024728-05). Retrieved via AI Analytics 2026-05-24 from https://api.ai-analytics.org/grant/nih/9916669. Licensed CC0.

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