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Hospitals shift business strategy to keep people healthy

Posted Oct 19 2010 3:00am

Tuesday, October 19th, 2010

By Kester Freeman
Former CEO, Palmetto Health

One of the key elements of the Affordable Care Act that many people do not dispute is the need to reform the way that healthcare is delivered in the U.S. That is where accountable care organizations enter the picture. A recent editorial helped explain that accountable care organizations – or ACOs as they are often referred to – may be just what the healthcare system needed and just in time.

The editorial published by AOL News explains the following:

An ACO – "accountable care organization" – is a group of physicians in the same organization who provide most or all of your care, but their focus is very much on the patient, delivering a new kind of team-based approach that really tries to put you, the patient, first.

For the doctors, it's a new way of structuring their practice to deliver better value and better quality of care to align with another new medical buzzword: patient-centered medical home.

For the patient, it means that finally someone is accountable for providing you with convenient, coordinated health care and for helping keep you in good health.

For health plans and for the government, which covers Medicaid and Medicare patients, it also means a way to transform reimbursement – based on quality of care, not volume of care – and reduce costs by keeping people well.

Put simply, ACOs are a home for your care.

It is refreshing to hear someone who understands a little of the dynamics of "healthcare.” I've said for years that a fee-for-service reimbursement system only rewards volume and not results. Even worse, it rewards the tail end of care, which is most expensive and does almost nothing for prevention or early treatment.

ACOs put the primary care doctors back in charge of patient care and rewards them for keeping patients healthy. What a novel idea. The editorial goes on to explain why ACOs will fare differently than HMOs:

The big difference is that in the HMO era there was little use of data to ensure that the system was performing to the benefit of the patient. An important requirement for ACOs is to capture and analyze data. Data will do for doctors' minds what X-ray has done for their vision – allowing them to see things in new ways.

The bottom line is improved healthcare delivered at a lower price tag. I know it sounds a bit like a sports car costing less than a sedan, and in some respects it is. Sometimes, a sedan is better for the job!

Specialists will scream about rationing and missed pathology, but with good data and evidence-based care, this criticism will likely become a thing of the past.

It is time to put doctors back on the front lines in terms of helping to keep people healthy and give them the risks and reward for this service. Physicians will be able to lead the way with significant help from other healthcare professionals. It truly needs to be a team effort, and that will include patients taking better care of their own health as well.

How Obama administration can help accountable care organizations (ACOs) succeed

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