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Incentives, Motivations Clash Under ACOs

Philip Betbeze, for HealthLeaders Media, April 26, 2013

My colleagues and I spend a lot of time and effort trying to understand the forces that are acting upon healthcare leaders these days. If it seems the level of transformation being asked of healthcare leaders is without precedent, it is, at least since the debut of Medicare.

I can think of no other industry where the stated goal of reform is to shrink its overall size and influence on the economy. Yet healthcare is asked to do this.

In many ways, healthcare leaders must balance that priority with the even greater priority of growing their healthcare systems and keeping them financially healthy. If they're participating in ACOs (in some cases, they have no choice), their incentives and their motivations are at cross purposes.

A body cannot serve two masters—except—some contend, in healthcare. Whether or not it is possible is to be determined.

Some recent research brings numbers and statistics to bear upon the predicament. MedeAnalytics, a healthcare performance management company, has identified metrics used in a variety of ACO constructs.

Guess what? They're not standardized.

Until many of the incentives are, it will be difficult—if not impossible—for CEOs to lead their organizations into standard practice protocols for the same reason: It is difficult to serve two masters. One might reward an activity while the other may punish it. Most of the incentives aren't diametrically opposed, but the fact that they are different makes this work exponentially more difficult.

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