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Is much-ballyhooed new health care model showing results yet?

Is much-ballyhooed new health care model showing results yet?

As advocates for evidence-based innovations, we were pleased to see a high-quality, two-year evaluation of the Pioneer Accountable Care Organization (ACO) program in a recent issue of the Journal of the American Medical Association.

As a brief primer on this complex topic, ACOs are an attempt to create a managed-care-like network within a fee-for-service environment. The specifics of each ACO differ, but generally a group of providers form a legal entity to coordinate care for a fee-for-service population. The provider network then shares in any savings that result if total costs are lower than projected, as long as quality standards are met.

As our friends from the single-payer movement (of which we are strong advocates!) remind us, the 1990s managed care experiment — the precursor to ACOs — failed miserably. Insurance company-led HMOs were widely considered to be ethically reprehensible, restrictive entities that prioritized cost-savings and profit over the well-being of patients. The public conversation about HMOs created a lot of mistrust between patients and health care systems that still reverberates to this day.

But could ACOs — which in theory can be led by doctors rather than by the insurance industry — work better than the HMOs from the 1990s?

From our read of this study and similar evaluations, it is still too soon to say. It appears that early on, health care spending within ACOs grows at a modestly slower rate than in traditional fee-for-service environments. In the Pioneer study, cost growth was 4 percent slower among ACO patients compared to the controls, which, if sustained, could substantially bend the cost curve. Quality indicators — such as patient experience scores and access to clinicians following hospital discharge — were also modestly higher among ACO patients.

But there are some important caveats. Early savings may not be sustainable: In the first year of the Pioneer study, average per-patient costs were $36 lower among ACO patients, but in year two, they were only $11 lower. In addition, only a small percentage of health care systems will likely have the infrastructure to effectively organize as an ACO. Moreover, becoming an ACO is a Herculean task, and many early ACOs, including several in the Pioneer study, dropped out of the program when it became clear they would not save money.

In concept, we like that ACOs encourage behaviors such as collaboration among providers. However, as was the case with HMOs, we also worry that systems driven by financial motivations and in competition with one another may adversely impact patients and create additional red tape for providers.

Ultimately, we suspect the only way to equitably ensure high-quality, coordinated care throughout the population would be a single-payer health care system, which has effectively achieved these goals in several other industrialized nations such as Canada and the United Kingdom.

[Photo by COD Newsroom via Flickr.]


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