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  • Obamacare’s ACO Conundrum

    Newscom

    Newscom

    Over the weekend, Bloomberg reported on the latest challenge to Obamacare: hospitals leaving one of the law’s signature attempts to contain health costs:

    Almost a third of 32 hospitals and health systems involved in an experiment aimed at changing the way medical providers are paid may exit the program, a potential threat to [Obamacare’s] ambitious cost-saving goals.

    According to a Medicare spokesman, nine hospitals and health systems participating in the “Pioneer” accountable care organization (ACO) pilot may leave the program outright—and four more “may join other accountable care programs that carry less financial risk.” This development comes three months after the Pioneers wrote to Medicare administrators asking for a delay in the program, claiming they were not yet ready to assume financial risk if patients’ costs rise more than projected.

    One of the reasons hospitals are leaving the ACO program involves government red tape. In order to manage their patients most effectively, hospital systems want access to real-time medical claims data—but Medicare’s lumbering bureaucracy can provide information on health claims six months after the fact. As the CEO of one hospital organization told Bloomberg, “We’re asking for more agility than the system is really set up to produce.”

    The other reason for the ongoing ACO struggles centers around the euphemistically termed “clinical control”—in other words, patients’ ability to see the doctor they want. The Bloomberg article notes that right now, hospitals in the ACO program “can’t forbid the patients from seeing doctors or other health providers who aren’t part of the Pioneer system.” Hospitals believe this restriction on their ability to manage patients has prevented them from containing costs as much as originally hoped.

    Viewed from this perspective, the latest news on ACOs provides policymakers with a difficult choice: impose more restrictions on patients of ACO participants to choose their own doctors—limiting access to care in a way many HMOs did during the 1990s—or see this supposedly “innovative” care model fail to reduce costs as promised.

    That’s not a choice seniors should have to face—and more importantly, they shouldn’t have to. In 2008, then-Senator Obama promised that “for those who have insurance now, nothing will change under the Obama plan—except that you will pay less.” This weekend’s Bloomberg story provides the latest evidence that, for millions of Americans, these promises will turn out to be empty.

    Posted in Obamacare [slideshow_deploy]

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