Accountable Care Organizations and Selling a Practice

Do I have to sell my practice to join an ACO?

No, you don't have to sell. But you should not be surprised to receive purchase offers. Family physicians and other primary care physicians are critical to the success of any ACO.

  • First, in many ACO programs, patients are attributed (assigned) to the ACO based on the provider of the plurality of primary care services. For an ACO to succeed, then, it needs to be built on a large primary care network.
  • Second, the typical ACO will cut costs by reducing avoidable utilization of high-cost delivery settings such as hospitals and emergency departments. These reductions are driven by strategies such as patient activation, chronic disease management, care coordination, management of care transitions, and effective prevention and wellness programs, all of which require high-quality, patient-centered primary care.

Alternatives to Selling

If you wish to participate in an ACO, you have several alternatives to selling your practice. For instance, many successful ACOs are developed by independent physician associations (IPAs), with members in independent or employed practice. Other ACOs have grown out of pre-existing physician-hospital organizations where the hospital is aligned with independent physician practices.

If you are not interested in selling, but an ACO in your area insists on contracting directly with participating primary care physicians, either of the following might be options:

  • Consider establishing a professional services agreement. With such an agreement, you could act as an independent contractor to the ACO, and your practice would remain legally and financially separate.
  • Consider a physician enterprise model (PEM) arrangement, wherein you would be employed through a third-party legal entity affiliated with the ACO. A PEM could allow you to retain full ownership of your practice.

The imperative of ACOs is to clinically align disparate health care providers to ensure that care is being delivered in the most appropriate setting and at the most appropriate time to ensure optimal clinical outcomes. If you do not want to sell your practice, you should be able to find another way to achieve your goals and the goals of the ACO.