President Obama’s practice models pilots are going to be a great waste of money. Each model has major defects.
None of the models offer patients the ability to control of healthcare dollars. None of the models provide incentives to patients to be responsible for their own health.
The models replace individualism with collectivism. They replace individual self-responsibility with community governance. Bureaucracy stifles initiatives and innovation, two characteristics that have been the engine of progress in medical advances.
The models subject medical care to the deadening hand of bureaucracy. The net result is a more costly healthcare system and increasing federal deficits. Bureaucracy always has loopholes. The advantaged vested interests always game the system to the disadvantage of consumers.
A typical Medicare ACO would include a hospital, primary care physicians, specialists and potentially other medical professionals. Services would still be billed under fee-for-service. The ACO’s members would coordinate care for their shared Medicare patients.
I do not know when hospital systems have not tried to profit from its physicians’ intellectual property. What will suddenly get them to not take advantage of physicians intellectual property?
“Because ACO members are held jointly accountable for this care, they would share in any cost savings that stem from the quality gains.”
Cost overruns would be deducted from the fees billed. Realistically surgeons have always dominated the primary care physicians. It is unrealistic to believe surgeons would relinquish this position passively. Surgeons would not agree to increase compensation to primary care cognitive physicians at their expense
The Medicare Advantage program pays a lump sum to private insurers. The government holds the healthcare insurance industry accountable for all medical care. The healthcare insurance industry is in control of the healthcare dollars.
“ACO allow for flexibility in the type of organization. Some regions may prefer independent practice associations (IPAs) while others may prefer a physician-hospital organization (PHO).”
The ACO is a fixed reimbursement system. Cost overruns will occur at the expense of physicians. Physicians and hospital systems will not know how to price reimbursement in advance. Utilization of medical care services is dependent on both patient and physician behavior. If patients were healthy there would be great cost savings. There are no incentives in ACO for patients to remain healthy.
“The physician-centered organization makes much sense to many policymakers because “the resources that flow from the decisions physicians make with patients account for a major portion of overall health care costs, regardless of where the care actually takes place.”
Physicians are good at treating illness. They are not good at risk management. Patients must be incentivized and taught to manage the risk of complications.
Many physicians will get stuck with high-risk patients. Medicare will have to increase payments to those physicians or risk losing them as providers. ACO will become insolvent. This will increase the deficit.