Accountable-care organizations, or ACOs, may be the ghost of health-care future for most Americans.
For Wayne-based Renaissance Medical Management Co., the designation is an opportunity to expand its model to a new patient population, starting Jan. 1.
Renaissance Medical was selected by the federal Centers for Medicare & Medicaid Services on Monday to participate in its Pioneer Accountable Care Organizations initiative.
Policymakers included ACOs as part of the federal health-insurance overhaul as a vehicle to deliver more coordinated care to patients to raise the quality of care and lower its cost. Federal officials hope the Pioneer ACOs - existing organizations that already provide coordinated care in hospitals, clinics, and doctors' offices - will save Medicare up to $1.1 billion over the next five years.
Of the 32 organizations chosen, the 11-year-old Renaissance Medical is the only one from the Philadelphia region. Most of the others are clustered in California, Massachusetts, Michigan, and Minnesota.
Marc Malloy, chief executive officer of Renaissance Medical, called the selection a "huge honor for us."
Owned by 207 mostly primary-care doctors in Bucks, Chester, Delaware, and Montgomery Counties, Renaissance Medical got its start through a joint venture with Independence Blue Cross that delegated greater authority to doctors in deciding treatment plans for HMO patients.
Its clinical-care nurses and proprietary software now help coordinate the care of nearly 200,000 patients in employer-based insurance plans and 20,000 covered by Medicare Advantage plans. The firm has 20 employees, Malloy said.
Under the Pioneer ACO program, Renaissance Medical is expected to add about 25,000 Medicare beneficiaries, said Malloy, who joined the firm two years ago after serving as CEO of Coventry Health Care of Delaware.
Federal officials will test different payment models through the Pioneer ACO initiative. Renaissance Medical and the others will be paid only after being measured on an annual basis on their performance on medical outcomes and cost savings.
Back to the lab?
AstraZeneca P.L.C., which has major operations in Delaware, will halt studies on an experimental treatment for ovarian cancer and said that another drug to treat patients with depression failed in clinical trials.
The firm said it would not conduct Phase III clinical trials for olaparib as a treatment for ovarian cancer. Also, Phase III study results for TC-5214 showed the drug failed to meet the primary end point set by researchers.
As a result, AstraZeneca will take pretax impairment charges totaling $381.5 million in the fourth quarter. It said the charges would have a 21-cent "negative impact" on the company's "core" earnings per share in the current quarter, although AstraZeneca left its earnings guidance unchanged at $7.20 to $7.40 per share.
American depositary receipts of AstraZeneca closed at $45.51, up 8 cents, Tuesday. However, shares of Targacept Inc., the Winston-Salem, N.C., firm that had licensed TC-5214, slumped 35.86 percent, or $2.79, to close at $4.99.