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Hospital Executives Search for the Formula for an Accountable Care Organization

Posted Oct 04 2010 12:00am

Mr. HIStalk, in his Monday Morning Update 10/4/10 , highlights a YouTube animated video entitled In Search of an Accountable Care Organization . As most of you will know by now, an ACO or Accountable Care Organization is a key requirement in the recent healthcare reform legislation. Hospital executives are searching for the secret sauce about how to transform their organizations into one. Information technology, and particularly EMRs, are critical elements in the recipe. Watch this short video -- very enlightening and uncomfortably funny.

KevinMD, a well-known and highly respected blogger about health issues, has this to say about ACOs :

Somewhere in the Obama Administration, there is an elitist central cabal that operates with the support of the highest organs of our central government....Much like pieces on a chess board, and with the support of renegade organizations like the Commonwealth Fund, the New England Journal and UNICEF, it wants to arrange hospitals and providers into regional klepto/monopolies that coordinate care, deprive us of access to breathing as well as dialysis machines and suck up tax dollars faster than Ms. Pelosi can say “but we’re saving money!” Just kidding, but it does seem to the Disease Management Care Blog that a lot is riding on the concept of large, regional and risk-bearing “accountable care organizations” (ACOs) that can reconcile cost and quality. And don’t think that there isn’t a hospital CEO, academic medical center Board or a medical school Dean that isn’t lusting over the prospect expanding and consolidating their local empires under the guise of Obamacare and enlightened not-for-profit community service. Ask these healthcare potentates, and they’ll tell you that this is the wave of the future, where size, access to capital and rationalized central planning will finally break the back of health care inflation and those evil insurers.

I agree with Kevin. ACOs will become the greatest boondoggle in healthcare since HIPAA and will provide major competitive advantages for large health systems. The regulations were ostensibly written with an eye toward increasing quality and efficiency of health care. In order to prove that they are accomplishing this goal, healthcare organizations, functioning as ACOs, will be required to churn out copious documentation to qualify for reimbursement. This requirement will favor large health systems with whole departments tasked with satisfying the federal bureaucracy's insatiable need for data. Much of this documentation will come from information systems, notably the hospital's EMRs. This will create an almost insurmountable barrier for smaller hospitals and private physician practices. These organizations will need to affiliate with the large regional health systems in order to survive. You may also want to refer back to my previous post about the growth of Big Medicine and how the health systems were consolidating in order to compete with the evil insurers and physicians were flocking to hospitalist positions (see: Physician Private Practice Declines; the Last Barrier to Emergence of "Big Medicine" ; ).

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