Long Term Care and ACOs

For years, long term care providers occupied an unusual position in accountable care. They cared for some of the most clinically complex and resource intensive Medicare beneficiaries, yet they were often treated as downstream service providers rather than strategic participants in an ACO's clinical and financial performance.

That distinction is becoming increasingly difficult to defend. ACOs are being held accountable for the quality, coordination, and total cost of care delivered across a beneficiary's experience, not simply for what happens inside a primary care office. At the same time, CMS continues to expand accountable care, with an estimated 14.3 million Medicare beneficiaries receiving care through ACOs in 2026. The growing scale of accountable care makes it more important for ACO leaders to understand where their most significant opportunities for clinical and financial improvement actually exist.

Long term care is one of those opportunities. Residents of skilled nursing facilities, assisted living communities, and other residential care settings frequently have multiple chronic conditions, complex medication needs, functional limitations, and high rates of care transitions. Their outcomes are influenced by the quality of coordination among facility staff, physicians, hospitals, specialists, pharmacies, families, and care management teams. When those relationships are fragmented, the financial and clinical consequences can extend across the entire ACO.

ACO leaders do not need to be reminded that utilization is concentrated among relatively small segments of the Medicare population. What deserves more attention is how often those high opportunity beneficiaries receive care in long term and post acute settings, and how much of their utilization can be influenced through better clinical infrastructure.

A hospitalization may appear on an ACO's claims report as an isolated event, but the circumstances leading to it often developed over several days. A change in condition may not have reached the appropriate clinician quickly enough. A medication issue may have gone unresolved. A physician may not have had sufficient visibility into the resident's recent clinical history. A discharge plan may have failed to account for the realities of the receiving care setting.

Each event has its own clinical explanation, but the broader pattern is usually operational. Avoidable utilization is rarely caused by one decision alone. It is more often the result of multiple small breakdowns in communication, visibility, accountability, and follow through.

This is why long term care matters so much within an ACO strategy. The opportunity is not simply to negotiate better post acute rates or direct patients toward preferred facilities. It is to create a more integrated approach to managing residents whose health status and service needs can change quickly.

Research published jointly by the American Health Care Association, the National Center for Assisted Living, and the National Association of ACOs has similarly emphasized that intentional partnerships with long term and post acute care providers have generated meaningful care improvements and savings within accountable care and other payment models.

One reason long term care has historically been difficult to incorporate into ACO strategy is that the term covers a broad and diverse care environment. Skilled nursing, assisted living, memory care, custodial nursing care, home based primary care, rehabilitation, and facility based medical practices all serve different populations and operate under different clinical and reimbursement structures.

An effective strategy therefore requires more than placing every facility into a single network category. ACO leaders must understand who is delivering primary care, how residents are attributed, which clinicians can influence utilization, where clinical data resides, and how decisions are made when a resident's condition changes.

That level of analysis often reveals that the most important relationship is not necessarily with the facility alone. It may be with the physician group caring for residents across several communities. It may be with a clinical team that can respond rapidly when a change in condition occurs. It may be with a pharmacy partner supporting deprescribing and medication reconciliation. In many markets, it will be a combination of all three.

The real strategic question is not whether an ACO has long term care providers in its network. It is whether the ACO has built a clinical and operational model capable of influencing care inside those settings.

Reducing unnecessary emergency department visits and inpatient admissions remains an important objective, but the financial value of long term care integration is broader than hospital avoidance. It also includes more appropriate site of care decisions, stronger medication management, improved chronic disease monitoring, more effective transitions, better documentation, greater quality measure performance, and clearer alignment between care management resources and beneficiary risk.

These opportunities are interconnected. Better documentation supports a more accurate understanding of the population. Better analytics allow care teams to prioritize residents with emerging needs. Better coordination improves the likelihood that a resident receives timely care in the most appropriate setting. Better provider engagement creates accountability for responding to the information the ACO generates.

The value compounds when these functions operate together. An analytics platform can identify a resident at elevated risk, but the insight has limited value unless someone is responsible for acting on it. A care manager can coordinate a transition, but that work becomes more difficult when the receiving provider lacks timely information. A physician can make a sound clinical decision, but its impact may be weakened by poor communication across the rest of the care team.

For ACO leadership, this means long term care cannot be assigned exclusively to the analytics team, the network team, or the care management team. It is an enterprise performance issue that requires clinical, financial, and operational alignment.

The availability of claims analytics, real time admission notifications, electronic health information, predictive models, and provider level reporting has changed what ACOs can know about their populations. Leaders no longer need to rely entirely on retrospective reports to understand utilization and performance. They can identify emerging patterns earlier and direct resources toward beneficiaries with the greatest opportunity for intervention.

However, more data does not automatically produce better results. Many organizations have invested heavily in reporting capabilities while leaving the operational response largely unchanged. They can see that a resident has been admitted, but they may not have a reliable process for engaging the facility, physician, family, and care manager. They can identify a pattern of potentially avoidable utilization, but they may not have aligned incentives or clear accountability for changing it.

The difference between a strong analytics program and a strong value based care program is execution. Data must be translated into specific workflows, assigned responsibilities, provider conversations, and measurable interventions. That is especially important in long term care, where clinical decisions may involve several organizations and individuals who do not share the same technology, incentives, or operating structure.

ACO strategies often focus on identifying high performing facilities and building preferred networks. That work is valuable, but it addresses only part of the opportunity. A facility can perform well on traditional quality measures and still remain disconnected from the ACO's broader population health strategy.

Meaningful alignment requires the long term care provider to understand how its actions affect the ACO's goals, while the ACO must understand the realities of delivering care within that environment. Facility leaders and physicians need timely, relevant performance information rather than generic scorecards. They also need a clear understanding of what the ACO expects them to do differently.

This is where physician engagement becomes particularly important. Many of the decisions that influence utilization, documentation, medication management, and transitions depend upon the clinicians caring for residents. ACO leaders who engage those physicians only through periodic reports or annual meetings are unlikely to achieve the level of alignment required for sustained performance.

The strongest long term care strategies connect data with physician leadership, local clinical workflows, and incentives that make better performance meaningful to the people delivering care.

CMS has stated that its current strategic direction includes increasing independent provider participation in value based payment programs and improving the administration of those models. The continued expansion of accountable care, including newer models such as LEAD, also reflects the increasing importance of building structures that can support different provider types and patient populations.

For long term care physicians and provider organizations, this creates a meaningful opportunity. These groups possess direct clinical influence over populations that have historically been difficult for ACOs to manage effectively. With the right structure, they can contribute far more than patient volume. They can become central partners in utilization management, quality improvement, care transitions, documentation, and patient centered planning.

The opportunity is equally important for ACOs. Organizations that develop authentic relationships with long term care providers can gain capabilities that are difficult to recreate through centralized care management alone. They gain clinicians who understand the resident, the facility environment, the family dynamics, and the practical factors that determine whether a care plan succeeds.

At VSM, we view long term care as a core component of accountable care strategy, not a separate service line or an afterthought. Our work brings together the infrastructure ACOs need with the practical realities of delivering care in long term and post acute settings.

That includes analytics that identify performance opportunities, provider engagement that makes those insights actionable, care coordination support that connects settings, and operational expertise that helps physician groups and ACO leadership execute against shared clinical and financial objectives. We also understand that sustainable alignment cannot be created by asking already burdened providers to absorb another layer of administrative work.

Our role is to provide the structure around the provider. We help establish the systems, resources, performance visibility, and operating support required to participate effectively in value based care while allowing physicians to remain focused on clinical leadership and patient care.

This approach also preserves the independence of long term care physicians and provider groups. They do not have to become part of a health system or build a complete ACO infrastructure internally to play a meaningful role in accountable care. Through the right partnership, they can retain their identity and clinical autonomy while gaining access to the scale and resources necessary to perform.

Long term care matters because ACO performance is increasingly determined by what happens beyond the traditional office visit. It matters because clinically complex residents represent an opportunity to improve care while addressing avoidable utilization. It matters because the providers working in these settings often have the relationships and clinical influence necessary to make those improvements possible.

Most importantly, long term care matters because accountable care cannot succeed through attribution and reporting alone. It succeeds when providers across the continuum are connected to the information, infrastructure, incentives, and support needed to make better decisions.

For ACOs, long term care is not a niche strategy. It is an essential part of managing total cost of care, improving quality, and building a model capable of succeeding as accountable care continues to evolve.

Whether you lead an ACO seeking to strengthen its long term care strategy or a physician organization exploring how to participate more meaningfully in value based care, VSM can help build the structure around that opportunity.

Connect with our team to learn how VSM brings providers, analytics, care coordination, and scalable operational support together to improve performance across the continuum of care.