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The Physician's Place in the ACO

Philip Betbeze, for HealthLeaders Media, November 15, 2010
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The PHO in Methodist's case is a fifty-fifty joint venture between the hospital and the physicians who practice there.

"If you take a PHO and you give them the bundled payment, they are in a good position to make sure the payment gets shared fairly," he says. "The interesting thing about the ACO is that they're not hospital- or doctor-centric; they're patient-centric."

One of the key pieces, he says, is being able to share medical and financial information across all the constituents so that they can move toward outcomes as the key metric. That's what many payers attempted to do in the 1980s and 1990s with capitation—an annual fee provided to a medical group for taking care of a certain number of patients. It was largely abandoned because most hospitals and physician practices were much less sophisticated than payers in analyzing risk among large groups and lost money under it. However, Mayzell believes experience with capitation will prove valuable as physicians and other healthcare organizations progress to ACOs.

If ACOs are to succeed where capitation failed, the group needs critical information about outcomes and utilization, he says. That's possible now.

"Capitation did some good things. It pushed risk down to the physician level and put them in control, but it didn't give them the information to really manage the patient's care," he says. "When capitation was in vogue, we didn't have the EMR capacities we have now. We have better tools, and we're better evolved in financial and clinical integration."

Removing variability

Many physicians worry that healthcare reform legislation will eliminate patient choice and physician independence. Those skeptical of that stance believe that preserving physician "independence" is a red herring and that physicians were thinking more about their own pocketbooks in largely opposing the law. But the truth is, compensation is likely to fall, especially among specialists.

Critics have another word for independence: variability—in other words, alternative approaches in how two physicians might treat the same ailment.

Variability has been shown to be an enemy of quality and coordination of care, two key principles necessary to cut healthcare costs, they contend.

Variability has been both paraded and pilloried under other terms, such as evidence-based medicine, which opponents like to call "cookbook medicine." But that debate has already been settled, as perhaps a majority of experts—physicians themselves—agree that the vast majority of clinical decision-making can, and should, be standardized. Whatever your politics, the influence of the rugged individualist physician is likely to be curtailed under the ACO model. However, many believe that the influence of physicians as a group will be the key determinant of best practices in patient care.

For instance, Ron Greeno, MD, founder and chief medical officer of Cogent Healthcare, a Brentwood, TN, company that provides hospitalist physicians and programming management to hospitals, says healthcare teams, with the physician at the head but with accountability running from the top of the provider food chain to the bottom, will likely form the backbone of the ACO.

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2 comments on "The Physician's Place in the ACO"


John Barbuto, MD (3/11/2011 at 1:00 PM)
You make a statement which is critically flawed. You say patients "are trying to get well". That is certainly true to a large extent. But, it has subtle, critical flaws. First, patients who seek health care are certainly trying to get health care, but they are routinely trying to get the health care they "think" will make them well. They are trying to meet their belief systems - which may or may not be consonant either with optimal care or with achieving health. For example, there is a huge industry of "health care" which is purchased via health food stores or other "complementary and alternative" sources. The vast majority of these services are provided with no rigorous science behind them at all - only claims and anecdote (and maybe some inferential low order studies). In these realms the hypothesis of "evidence-based medicine" is a joke; yet, the services are consumed to the tune of many billions of dollars a year. And, this example only represents a concept which has much greater ramification even than this industry. In addition, a small but critical portion of patients come to the doctor to obtain services which support some secondary agenda - an agenda which may not be served by becoming well. So, for example, auto or industrial accident blame games, unwarranted disability pursuits, escape from responsibility, social control over others, and other "hidden agendas" lead to service which is rendered not to become well but rather to serve the hidden social agenda. This also is big business in some arenas. So, while it is true that most patients seek to become well, the most accurate statement is that patients seek health care to receive health care services - whatever agenda may be underlying the pursuit. We like the hypothesis that medicine proceeds best based on evidence-based science. But, the actual evidence is that this hypothesis is flawed in some important ways.

Gregg Masters (11/16/2010 at 2:08 PM)
Nice piece! We really need to keep the focus on the provider education perspective; via a lens of institutional memory, lest we recreate the same mistakes of the past. The scope and range of concerns, including the many competing voices for visibility in this space require attention on key narrative curation, and vetting of the many threads in this unfolding story!