Sour Grapes, Low Hanging Fruit, and Fine Wine…

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I’ve written about Obamacare often. (Here’s one such article– you can find more searching for Obamacare or PPACA via the search box to the right.)  So have others. While the original goal of the concept was to improve the health of Americans, it seems that we settled for insuring most Americans and making health care more accessible.  (A valid goal, but far less lofty.)  But, there always is the hope that we can reduce the costs of healthcare, too.

One pilot program was the development of Accountable Care Organizations (ACO), conglomerations of physicians, clinics, and hospitals. (This is  one reason why many hospital systems and insurance companies have been purchasing physician practices- to render them capable of being an ACO, which has something akin to the “most favored nation” status under the program.   I will be presenting a more nefarious reason in my next post on this subject.)  ACO’s are supposed to coordinate care, lower costs, and improve quality for a specific patient population; they are paid to keep patients healthy and not via fee-for-service. There are 33 quality measures that they need to achieve- and, if that happens, the savings are split equally between the ACO and Medicare. As of the beginning of this year (2013), ACO’s were signed on to provide care to more than 4KK (million) Medicare beneficiaries in 49 states.

But, all does not seem well under the pilot programs. PACO (Pioneer Accountable Care Organization) has been involved in one of the pilot programs. This 32 unit system demonstrated unequivocal improvements (100$ of all members met or outperformed the targets and scored highly on patient satisfaction, to boot) to patient care for blood pressure, cancer screenings, etc. Costs for the almost 670K patients in the system grew by 0.3% during 2012. (By comparison, costs grew 0.8% for Medicare beneficiaries that year.)

But, only 1/2 (OK, 18 of 32) actually demonstrated their ability to do so while lowering costs for their Medicare patients- and two of them actually lost money on the progam. Which probably explains why 7 units have notified the Medicare Administration (CMS, Centers for Medicare and Medicaid Services) that they wish to be placed in a program where their risks are lower (and the potential financial gains are also lower) and 2 have requested to leave completely. (At least of this writing, the names of these departing units are not public knowledge.)

13 of the 18 financial success saved Medicare some $87.6 million (earning the same bonus for themeselves). Partners Healthcare (the group including Mass General in Boston) managed to obtain more than $ 7 million in rebates- and that is despite the fact that 70% of their patients are still in fee-for-service arrangements.

Atrius Health (Eastern/Central Massachusetts) did not achieve any savings. (This was one of the 2 money-losers). They believe this was related to the fact that had already managed to squeze their costs dramatically prior to their participation in the program. And, now they fear they may have to return some $ 2 KK to Medicare, as a result of their failed efforts to reduce costs within the program. They feel the member units who demonstrated savings accumulated them from the “low-hanging fruit”.

Let’s see what this year brings.

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