U.S. health insurer
) has agreed to form an Accountable Care Organization (ACO) with
PinnacleHealth System. This is in sync with the company's efforts
to improve safety and quality of patient care and a move towards
more affordable health care.
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An ACO is a collaboration of health care providers who
voluntarily form alliances to provide coordinated high quality
care to patients. An ACO is accountable for the quality, cost,
and overall care offered to members.
With this ACO agreement in place, Aetna wishes to introduce both
fully insured and self-insured healthcare plans in Central
Pennsylvania. A fully insured product will be available on April
1, 2014. A small-group product for groups of between two and 50
employees will be available from Jul 1, 2014.
ACOs or collaborative accountable care is one of the several ways
by which policies undertaken under President Obama will go to
improve the quality of health of all Americans.
Aetna is aggressively expanding its ACO strategy by collaborating
with provider systems, which includes multi-payer primary care,
Medicaid primary care, state-wide ACOs and multi-line multi-payer
ACOs. As a consequence, Aetna's ACOs are gaining traction and
enhancing its core business. Aetna plans to hit a total of 30
ACOs by the end of 2013. The company intends to double this again
in 2014 to 60 ACOs. Aetna has over 200 ACO deals in its pipeline
that could serve 60% of the U.S. population. ACOs allow the
company tighter control over medical management, generating on
average 10% savings. Aetna's ACO strategy will enable it to
attain highly competitive cost structures.
Other health insurers like
UnitedHealth Group Inc.
) are also aggressively forming ACOs. Going forward, we expect
such patient-centered collaborations to grow rapidly.
Aetna currently retains a Zacks Rank #3 (Hold). A better ranked
health care provider under our coverage,
), with a Zacks Rank #2 (Buy) is worth considering.