ACOs- The Hottest Thing in Health Reform

Who would have believed it? The subject of Accountable Care Organizations (ACOs) accounted for only 7 pages of the 2500 page health reform bill. Yet ACOs are now the buzz, the rage, the hottest 3-letter acronym since sliced bread, and the most talked about subject in hospital board rooms, medical staff lounges, and the medical talk circuit, and consultant enclaves.

Why is this? Why all the hype?

• The Obama administration is banking on hospital-doctor collaboration to save at least $5 billion for Medicare and to “bend the cost curve.”

• For the government, ACOs open the conceptual door for switching from open-ended fee-for-service payments to closed budgeted reimbursements.

• ACOs strike at the very root of hospital-physician relationships, their dependence on each other, and physician independence.

Since the passage of the Accountable Care Act on March 23, 2010, I have been waving the yellow flag of caution on ACOs. ACOs raise antitrust issues in rural areas, hospitals tend to control them, and they threaten the very existence of private practice. On the other hand, hospital-physician collaboration seems to many outside observers as the right thing to do.

I have discussed positives and negatives of ACOs in 10 previous Medinnovation blogs, which you may want to read. To do so, go to search box on medinnovationblog and type in ACOs. The following ten blogs will appear.

1) January 7, 2011 – Accountable Care Organizations – Rosy and Not So Rosy Scenarios

2) January 6, 2011- Hospital Physician Relationships, Accountable Care Organizations, and Health Reform

3) December 10, 2010 – Accountable Care Organizations(ACOs) – Negative Reaction Among Physicians

4) November 21, 2010 – The Obama Administration in a Clash All by Itself over Accountable Care Organizations: Has Government Created A Cost-Raising Monster?

5) November 8, 2010 – The Hospital-Doctor Hiring Wave

6) October 18, 2010 – Accountable Care Organizations as Private Practice Killers

7) October 7, 2010 – On Being Politically Correct and Realistically Correct about Accountable Care Organizations

8) September 16, 2010 – Accountable Care Organizations – California or Bust?

9) June 23, 2010 – Saving Medicare Through Accountable Care Organizations – It’s A Long, Long Way to Tipperary

10) June 14, 2010- Whats, Whys, and Hows of Accountable Care Organizations

Richard L. Reece, MD, blogs a Medinnovation and has a website under constuction. www.doctorreece.com. He is the author of three recent books, Obama, Doctors, and Health Reform (Iuniverse, 2009), Innovation Driven Health Care (Jones and Bartlett, 2007), and an E-book, Pros and Cons of Accountable Care Organizations (Practice Support Resources, 2011). He works with but does not speak for The Physicians Foundation, a 501C3 organization representing physicians in state medical societies. He can be reached at rreece1500@aol.com