Accountable care organizations are a new financial arrangement proposed as part of the affordable care act. Some have describe them as 'unicorns'; every one knows what they look like but no one has seen one. Recently the Centers for Medicare & Medicaid Services under the aegis of the affordable care act presented several regulations that better outline what constitutes an accountable care organization.
This made headlines recently. Especially in the hyperbolic conservative press this was seen as a major setback for the affordable care act. Do not let these recent headlines confuse you. Group practices and accountable care organizations will dominate in the years to come whether the affordable care act implemented or not.
The evolving form of accountable care organizations did not get good press in recent weeks. In fact, with the announcement from the American Medical Group Association that several major medical centers it represents would not participate in a program to develop accountable care organizations, the headlines were not optimistic for the entirety of the affordable care act. The true meaning of the declaration from the American Medical Group Association was absent especially from conservative journalists. A closer look reveals an active negotiation between hospital systems and the administration that does not represent a ‘fiasco’ as the Wall Street Journal has defined it in a well-cited opinion piece. Once again anxiety over healthcare reform is creating headlines but inaccurately portraying what is a sober, academic discussion between hospital systems and the government.
When the healthcare re-form law was passed in 2010, formation of a medical group called an accountable care organizations was planned but not explicitly defined. In late March of this year Centers for Medicare & Medicaid Services (CMS,) released regulations which better define what an accountable care organization includes. The organizations represented by the American medical group Association declined to participate citing cost concerns about the all too specific regulations. They also did so simply because they could decline. Implementation of an accountable care organization is not required under the affordable care act until 2012. This lead time is available for centers to develop their own ideas for the form of their accountable care organization.
Some of the intellectual foundation for an accountable care organization comes out of work from Elliot Fisher here in New Hampshire and Mark McClellan at the Brookings institution. Whatever an accountable care organization may be in a fully mature form -- and that can take on several forms -- the intent of the economic structure is to provide affordable care and importantly longitudinal care for patients. They have proposed accountable care organizations as a solution for rising healthcare costs for greater part of a decade.
The hospital system in which I participate and am an employee has begun developing a group practice model for our region of New Hampshire. We have been calling this an accountable care organization for about a year now. The intent is to fulfill the requirements under the affordable care act regardless of whether the State of New Hampshire and legislature is actively pursuing compliance with the law. All this is wise. All this is part of the trend that was ongoing prior to the passage of the affordable care act. Consolidation of practices has proven advantageous for both physicians and hospitals and had nothing to do with healthcare legislation. Market forces -- the expense of equipment as much as expensive salaries -- are driving new financial arrangements.
The laudable goal of the accountable care organization is to provide better care and lower cost. This transcends party lines. When William Frist, former majority leader and chest surgeon, was asked what health care re-form should include, he recommended a reimbursement system based on successful treatment of illness rather than fee-for-service payment. Accountable care organizations are healthcare systems whose intention is to ensure just that. Bob Dole in interview last summer emphasized the same point and critique of present healthcare system. It was in that same interview on national public radio that Bob Dole warned his own party that being the party of ‘no’ is not an enduring plan for success.
I will leave with this observation that prominent republican politicians are at odds with their own party. Why is that? Present efforts in conservative circles to reduce the effectiveness of even uncontroversial aspects of the affordable care act, to stymie healthcare reform all together, demonstrate how detached from reality present legislators have become. Determined to support an ideology rather than innovative, helpful ideas, conservatives are being the heavy hand of government they so often blame for stagnation.
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