5 Reasons Why ACOs Could Fail
Here are the five major obstacles for ACOs, which could cause them to fail:
The vast majority of physicians still do not have the sort of electronic health record systems that many established group practices, like the Geisinger Health system, "use to manage non-hospital care across their patient populations." Despite financial incentives from the Health Information Technology for Economic and Clinical Health (HITECH) of the American Recovery and Reinvestment Act of 2009, "it remains to be seen how much of this technology gap can be bridged, and how soon," and it may take five to 10 years before these systems measurably change how care is delivered.
2. Income redistribution
The rewards for having an ACO, a share of savings if the providers reduce Medicare cost escalation, "are grafted on top of a payment system that still rewards individuals for increasing the volume of clinical services," Goldsmith says.
High-earning specialists, particularly surgeons and those providers who rely on revenue from advanced imaging, "have far more compelling incentives to keep their volumes (and incomes) up than do primary care physicians, psychiatrists or diagnosticians who use less sophisticated technology," Goldsmith says.
A major hurdle is the fact that many high-earning specialists have consolidated into single-specialty practices precisely to resist attempts to make them share or redistribute their income. "These single-specialty groups –which ACOs will find as hard to absorb as gravel in the digestive tract, generally did not exist when the first wave of independent practice associations, provider sponsored organizations and other risk-sharing enterprises were created."
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