Could Health Plans Derail ACOs?

Jeff Elliott, for HealthLeaders Media, October 27, 2010

On paper, accountable care organizations (ACOs) and their promise of lower costs and improved quality appear to be just what this country's convoluted healthcare system needs. Realistically, there are many barriers to widespread execution, none of which are more formidable than ACA-weary health plans.

Perhaps it is comments like the one uttered during a New England Journal of Medicine-sponsored roundtable on ACOs by Dr. Lawrence Casalino, chief of the Division of Outcomes and Effectiveness Research and a professor at Weill Cornell Medical College, that have insurers a bit on edge:

"Actually, kind of the holy grail at the end of all this would be where an ACO is large enough and competent enough so payers would basically say, 'Here's the money. You take care of patients. You do it the best way that you know how. There's no utilization management. There's no prior authorization. There's no denying of fee-for-service claims. You just do it the best you can. And we'll be measuring quality and patient experience, to make sure you are not stinting on care.'"

In a perfect word, that would be the case. But the reality is that everyone will protect their own interests, which has health plans knocking on doors not only at the Centers for Medicare & Medicaid Services (CMS), but also at the Federal Trade Commission (FTC) and Department of Justice (DOJ), making sure they're aware that collaboration among already powerful healthcare providers under the ACO model also includes the risk collusion.

In a letter to CMS from America's Health Insurance Plans (AHIP) prior to a public workshop sponsored by the FTC, Office of Inspector General (OIG) and other federal agencies to discuss ACO legal issues, the association expressed its concern that ACOs could potentially be developed with the sole purpose of amassing market power.

Facebook icon
LinkedIn icon
Twitter icon