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Wednesday, June 8, 2011

Accountable Care Organizations--some perils and pitfalls

It is ever more widely accepted that fee for service medicine, that is payment for individual services that medical professionals provide, by patients or by insurers, is a bad idea. If a physician is paid to deliver a specific service, such as seeing a patient in the office, removing his or her gallbladder or doing a colonoscopy, the physician will perform more of these services, regardless of whether this improves the health of the patient. Ethically a doctor may make appropriate choices, but financially the reward will be for quantity of services not quality of care. If a health care provider is paid to take care of a patient, a flat fee per patient per year for instance, the incentive will be to keep that patient as healthy as possible with as little medical intervention as possible and to prevent costly disease. This is known as "capitation" (literally paying by the head.)

Capitation has been tried and used in many situations over many years in medicine. Staff model health care cooperatives such as Kaiser and Group Health operate this way. Many states pay flat fees to providers to serve their medicaid populations. Outcomes are often better because this system focuses on continuity of care with members assigned to specific doctors, and usually involves better coordination of aspects of care by the different providers involved. It sometimes irritates patients because choices of specialists and medications are often limited due to the staff model and to money saving drug formularies. In cooperatives, a governing board which includes patients help make decisions about what kinds of care are provided, which makes them somewhat more responsive to consumers' needs.

The present model (outlined in the Affordable Care Act) that attempts to get away from fee for service medicine is called the Accountable Care Organization (ACO). A group of physicians, often in cahoots with a hospital, can contract with medicare to provide service to at least 5000 medicare patients, and if they can provide that care for cheaper than benchmarks, while documenting good quality as measured by various things that organized medicine thinks is important such as lab test numbers and hospital admissions, they can have a share of the saved loot. There are various reasons why this is not a great solution. First of all, the creation of accountable care organizations is driving a big push by hospitals to employ physicians, which may make medicine more corporate, placing yet another entity between the patient and the provider. If a physician is employed, the rules of practice will likely be defined by the employer, and if that employer is interested entirely in saving money, convenience and the human touch may well be lost. Also, these much larger organizations may, by controlling more of the care that is delivered, have enough power to actually push costs up by monopolizing care.

Another problem with the present model of an ACO is that it would not end fee for service at all, and so the administrative hassles involved in making lists of diagnoses for each patient and matching them up with fees for units of service will continue to eat up our time. More non-patient time will be eaten by the documentation of quality. It is not entirely bad to be required to demonstrate that our care works, but the devil is in the details, and getting cholesterol numbers just right may not be the thing that my patients actually value.

Finally, in my personal world, ACOs are impractical because a community the size of mine, around 20,000 people, is too small to have 5000 medicare beneficiaries as is required by the Affordable Care Act. We could potentially hook up with other communities, but having meetings and communicating would be a nightmare, given the density of population around here.

I do think that physicians need to be more involved in providing care for patients that contributes to their actual health and happiness instead of simply providing units of service. I think that a system that rewards good care and encourages creative ways of delivering it are part of a successful future for medicine. It is vitally important in all of this that we continue to care for our patients and remain committed to the give and take relationship that allows us to share our knowledge while respecting what our patients value. Having a third party, an insurance company, pay for our services already negatively affects this intimate partnership. It is my hope that in reforming our present payment system we do not introduce yet another financially motivated entity into the exam room.

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