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Scenario Planning in a Post-ACO and Post-ACA World for the Care and Population Health Management Industry

Posted Dec 08 2011 8:32pm
....and suppose there are 55
Republican Senators?
In a prior post , the Disease Management Care Blog provocatively suggested that providers, hospital boards and policymakers should hedge their bets and prepare for the possibility of a "post-ACO world."  If the Group Practice Demo's disappointing results are any guide, the likelihood of a happy ending for accountable care organizations is on numerical par with Congress' approval rating. While the DMCB likes the mutual "win-win" theoretical construct that underlies ACO gain sharing , it also recalls a life-lesson from the DMCB spouse: want you want and what you get are usually two different things.

So, if the Feds have to eventually retreat on the non-success of ACOs, what will be left in its wake?  More on that in future posts.

And while the uncertainty surrounding ACOs isn't bad enough, the DMCB has also been astonished by the battered Euro, the appearance of hospital-employed cardiologists and the absence of a Lady Gaga Christmas album.  Accordingly, the DMCB has learned its lesson and assumes nothing. 

That's why it's only natural that it would pay attention to this short and useful New England Journal Perspective article on the 2012 U.S. elections . Author David Blumenthal portrays the "consequences" as potentially "huge." The DMCB agrees. 

Three potential scenarios warrant health care leaders keeping their options open
1. Obama wins, the House retains a Republican majority and the Senate retains a Democratic majority: Even if the individual "mandate" is struck down by the U.S. Supreme Court, the President will continue to implement the ACA's expansion of Medicaid, state exchanges, insurance subsidies and employer penalties.  House Republicans will continue their "defunding" attacks and may even draw some blood over the Innovation Center and comparative effectiveness research .

This makes the DMCB believe that more insured persons will increase the demand for population health and care management services. However, if your program is dependent on grants, watch out because the money is going to dry up - even if you have good outcomes.

2. Obama wins, but both the House and Senate have Republican majorities: The Republicans will reduce funding, hollowing out the ACA's ability to expand Medicaid coverage or support insurance subsidies. Mr Obama may have to compromise on enforcement of exchanges and employer penalties.  In the end, however, Presidential vetoes mean the ACA will not unravel, only slow down.

In other words, says the DMCB, because the number of persons entering the insurance market will be blunted, all those expansive population health business plans will need to be scaled back.  Relentless increases in health care costs among persons with insurance will spur interest in innovative care management programs that can do it better and cheaper.

3. The Republicans win a trifecta, taking the House, Senate and Presidency: Absent a 60 vote majority that can overcome Democratic filibusters, the Republicans will rely on the reconciliation process and the power of the purse to undo many of the ACA's provisions.  There'll be some modest programs involving bundling, care coordination and primary care, but the United States' "post-ACO" world will be eerily similar to the "pre-ACA" one.

To the DMCB, that means there is little hope that fee-for-service Medicare or Medicaid will cover care management.  As more persons become uninsured, population health companies will not only need to do it better and cheaper, success will depend on making more money off of fewer persons.  The only way out will be game-changing "killer" innovations.

The DMCB also offers up its own three scenarios  
1. Progressives, having the upper hand, will overreach and pronounce debate over the government's role in health care as over.  If cost-saving innovations flounder, the federal deficit grows and costs continue to gobble up more of the nation's GDP, the Dems will raise the option of a public payer.  Come to think of it, the DMCB suspects they'll bring it up anyway. Bloggers everywhere will be in hog heaven.

2. Progressives everywhere will pronounce any electoral loss as further evidence of their failure to properly educate a preoccupied and non-expert electorate on why they should let Washington run things.  Conservatives will overreach and pronounce the debate over the government's role in health care as over. They'll openly conspire to repeal Medicare.  Bloggers everywhere will be in hog heaven.

3. Conservatives, having the upper hand, will overreach and will assume Medicare beneficiaries want vouchers.  Smarter Republicans will have little appetite to repeat Mr. Obama's mistake of spending precious political capital on health care versus something far more important, like school prayer.  And...  bloggers everywhere will be in hog heaven.
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