Wednesday, February 1, 2012


In order to address the rising costs of healthcare, several different health delivery models have been proposed. Lets' take a close look at ACO's, Accountable Care Organizations. The ACO is included in the PPACA, the Patient Protection and Affordable Care Act. ACO's take up only 7 pages in the massive legislation, yet, this network of providers has received much attention in the news, in the past year. Let's take a closer look at some of the specific language used to describe what an ACO is.
An ACO is a network of doctors and hospitals that share in the responsibility for providing medical care to patients. The details of the parameters for which ACO's will function are still being determined, but some of the specifics have been revealed. For example, one of the provisions is that ACO's would agree to manage all of the healthcare needs of a minimum of five thousand Medicare beneficiaries for at least three years duration.
Harold Miller, president and CEO of the Network for Regional Healthcare Improvement and executive director of the Center for Healthcare Quality and Payment Reform in Pittsburgh, Pennsylvania suggests we should think of ACO's as buying a television. Take for instance Sony Corporation, which may contract with many suppliers to build individual television sets, ACO's would bring together all of the various components needed to provide health care for these five thousand Medicare patients, like: the physicians, the hospital, and the ancillary services such as home health care and physical therapy, just to list a few. This would ensure that all parts are working together to provide the individualized health care services that each patient needs.
Currently, patients receive each of these components separately from multiple different sources. By contract with an ACO to provide the entire gamut of care, this will make the system more efficient and the odds of duplication significantly less likely. Instead of solving each patient's medical needs with numerous unrelated services, the hope is to provide each patient their total medical care under "one roof", so to speak.
In theory, some of this makes sense, as it is true that many services are repeated and duplicated, rather than only provided once. When a patient is seen by their PCP (Primary Care Provider) the doctor may order specific lab and x-ray studies. If the patient is referred to a specialist, this doctor will likely re-order some if not all of the studies that have already been performed. This duplication of services has proven inefficient, and highly expensive. So, in theory, ACO's may just work to make the patient experience more cost effective and more efficient for each patient. However, these organizations remain in their infancy, and it's uncertain whether their claim to keep costs and duplicated services down, are not yet proven.
Like any new potential solution to a multi-faceted problem, the proposed solution must be given ample time and resources to determine whether the claimed benefits actually come to fruition. Considering how inefficient our current state of medical affairs are, it seems reasonable to give ACO's a chance to succeed. If they do everything that the proponents of these organizations claim, this may just be one of the answers to our health care delivery system problems. And if the ACO's fail, like Thomas Edison and the electric light bulb, we will have found yet another example of how not to solve our nation's health care problems. And this in and of itself, does provide some secondary benefit.

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