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ACO’s

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Recommended repairs for ACO’s

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They write that the recent  U.S. Department of Health and Human Services announcement by that Medicare will work to accelerate the transition to new payment models was  … ”an important step in the right direction. But without significant regulatory—and perhaps legislative—changes to current models, HHS’s ambitious goals are not likely to be achieved. ”
The writers conclude:
”First, the financial model for ACO’s should offer them a greater share of their initial savings (to help fund start-up costs), provide stronger incentives to induce and maintain participation from low-cost provider organizations, and foster alignment of payment schemes across all payer types—not just in Medicare. This strategy will encourage the growth of shared-savings models and motivate high-performing healthcare systems to join the ACO programs.”The second strategy would improve patient engagement in ACOs by modifying how Medicare beneficiaries are assigned to an ACO: Beneficiaries should be given the opportunity to choose to join their ACO; for those not actively choosing, those eligible should be assigned at the beginning of the year (so that their ACO can contact them). Medicare should also test a benefit design that uses modest financial incentives to encourage patients to seek care within their ACO or from providers outside the ACO whom the ACO recommends. Simultaneously, to make such incentives possible, supplemental Medicare plans should be restricted from covering first-dollar beneficiary costs for non-ACO services.”


Cutting waste: Advancing beyond the ACO

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Modern Healthcare reported that “Chapin White, a senior policy researcher at the RAND Corp., pointed to the historic slowdown in Medicare costs as one of the most important trends in healthcare spending. But he also pointed out that the spending reductions have been achieved largely through rate cuts to providers rather than widespread adoption of risk-based payment systems. ‘ACO’s are really tinkering on the edges of the big picture of Medicare spending,’ White said.”Patient Centered Medical Homes and bundled payments are two other approaches  to avoid rewarding providers for quantity of care instead of quality.

”Kristen Miranda, vice president for strategic partnerships and innovation at Blue Shield California, said the changing payment landscape is resulting in some strange bedfellows….she cited the not-for-profit insurer’s partnership with competitor Anthem Blue Cross to launch the $80 million California Integrated Data Exchange as evidence of unique collaborations aimed at creating a more efficient healthcare system.”

Some argue that ”paying doctors more for services provided at hospitals than they get paid for the same care delivered in an office is driving up costs and driving consolidation. ‘The site-of-service differential has to go,’ said Simeon Schwartz, CEO of New York’s WESTMED Medical Group,” Modern Healthcare reported.


Reinhardt’s plan for changing physician-management model

* Develop ”five-year plans on the premise that the traditional, cost-plus reimbursement model will persist for very long is a bad idea. It probably won’t.”

* Consider ”the upfront losses {they} take on newly employed physicians as just another investment in the long-term future of your enterprise.”

* Don’t ”treat physicians as regular employees. Work to avoid their resentment against too distant and too opulent a C-suite. Instead, … make physicians feel part of the management team that jointly makes or breaks your enterprise. That includes regularly sharing managerial and financial data on your enterprise.”

* Consider “a workable alternative to employing physicians—e.g., the Kaiser Permanente model, the mother of all ACO’s.”

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