Health Reform, ACOs, Seldom is Heard an Encouraging Word

Simple solutions seldom are.

Alfred North Whitehead, 1861-1847

June 7, 2011 - To the Obama administration, ACOs seem simple. You reward hospitals and doctors to bond together to save money on Medicare patients, and hospitals and doctors share the savings.

But ACOs rules, just released, are not so simple. The proposed rules tie together quality measurements and financial rewards. ACOs must report quantitative results on 65 quality measures, grouped into 5 categories – patient and caregiver experiences, care coordination, patient safety, preventive health, health of frail elderly populations – all as defined by CMS, of course.

For hospitals and doctors, these and other rules make for an unpredictable bureaucratic nightmare. Caregivers desist and resist forming ACOs. For good reasons. As I observed in a June 3 medinnovation blog “Why Accountable Care Organizations May Flounder and Fail.”

“Why Accountable Care Organizations are destined to fail, and may not even get off the ground, is no mystery to me. Why would hospitals and physicians join together to form an organization that requires $11 million to $26 million to form (AHA estimate); that demands an inordinate amount of time, trouble, and grief to negotiate; that is designed, even guaranteed, to decrease reimbursements of hospitals and doctors; that hands over the reins of dispensing “savings” to your competitors and the government, reimbursements CMS may choose to reduce in the future; that subjects you to the risk of being sued by the Department of Justice for monopoly behavior; that requires you to be accountable financially for the behavior and complications of populations of patients before, during, and after hospitalization over whom you have little control; that 94% of members of the Medical Group Association of 400 integrated health organizations, supposedly ideal candidates for ACOs, have said they will choose not to join. Hospitals, doctors, and leaders of integrated health organizations are not dimwitted lemmings anxious to jump off the ACO cliff into an unknown abyss.”

Seldom have health leaders reacted so furiously and swiftly to a CMS proposal.

In a June 2 New England Journal of Medicine perspective piece, “Spending to Save – ACOs and the Shared Saving Program, “ Paul Ginsburg, PhD, of the Center for Studying Health System Changes and the National Institute for Health Care Reform, remarks,

“Clearly, much is at stake. Medicare has the potential to push health care delivery in a new direction…Many would-be ACOs probably aren’t ready for prime time..getting too few participants is a risk, and CMS clearly already recognizes that substantial changes are needed. Sometimes in Washington you only get one chance.”

Let us hope Washington seizes its last chance to change. Seldom have so few at the federal level sought to dictate the tune for so many on the domestic home front. CMS, by simply offering an encouraging word by backing off from its unworkable rules or redefining them, could further health reform. Thus far, for most caregivers, of health reform, it might be said: "Home, home on the range, where seldom is heard an encouraging word, and the clouds are cloudy all day."