‘Accountable Care’ Helping Hospitals Keep Medical Costs Down – NYTimes.com

But even as more health systems seek to replicate Advocate’s early success, its experience shows just how hard it may be to expand the approach and keep medical costs from resuming their relentless rise.

“It’s hard to imagine that you could start from scratch and do this and be successful in three years, said Dr. Lee Sacks, Advocate’s chief medical officer, noting that other systems may find it far harder to flip the traditional fee-for-services system on its head. “We had a running head-start going back to 1995.”

Nonetheless, the Affordable Care Act, President Obama’s health care law, has helped encourage a shift to Advocate’s payment model. Such agreements were merely a theory four years ago. But an estimated 428 accountable-care organizations now cover four million Medicare enrollees and millions more people with private insurance.

via ‘Accountable Care’ Helping Hospitals Keep Medical Costs Down – NYTimes.com.

ACOs Request Delay On Quality Penalties: Setback Or Wise Waiting? | CommonHealth

The five Boston Pioneers say they expect to stay in this program that will inform, if not create, the framework for a new way to manage care, both in Massachusetts and across the country.

“While we have concerns over the proposed benchmarks for performance year 2013, Steward Health Care remains committed to working with the Center for Medicare & Medicaid Innovation towards our collective goal to enhance quality and lower costs for Medicare beneficiaries,” says Steward spokesman Chris Murphy.

But providers aren’t willing to lose much, if any money, in this experiment, and that’s where it gets messy. Will Medicare adjust the quality rules to keep everyone in the program?

via ACOs Request Delay On Quality Penalties: Setback Or Wise Waiting? | CommonHealth.

Fisher, McClellan and Shortell: The Real Promise of ‘Accountable Care’ – WSJ.com

Accountable care organizations at their heart are about aligning provider financial incentives with patient needs for better health and lower-cost care. Unlike traditional third-party, fee-for-service insurance, which pays more for doing more, the payment models underlying accountable care pay providers more for achieving better care at a lower cost.

This is not a return to 1990s-style HMOs, which put the focus largely on reducing costs, so that patients and their physicians worried about stinting on care. Under the ACO payment model, the health-care providers aren’t eligible to keep the savings from lowering costs unless they achieve measurable quality improvements. Such quality measures weren’t available in the 1990s and can’t come primarily from insurance companies.

via Fisher, McClellan and Shortell: The Real Promise of ‘Accountable Care’ – WSJ.com.

Provider Market Power in the U.S. Health Care Industry: Assessing its Impact and Looking Ahead

Provider Market Power in the U.S. Health Care Industry: Assessing its Impact and Looking Ahead. Catalyst for Payment Reform.

Big health: Consolidation and competition under the Affordable Care Act – Health – AEI

Continuing consolidation in the health industry has enabled providers to raise their prices without improving the quality of their services. At an AEI event on Friday, a panel of economists and lawyers discussed the economic and legal causes of the concentration among health care providers and insurers and its pernicious effect on health costs.

Martin Gaynor of Carnegie Mellon explained the existing evidence corroborating rising consolidation, noting that the hospital sector has seen over 1,000 merger and acquisition deals from 1994 to the present. The resulting lack of competition among hospitals and other providers allows those providers to monopolize the market and charge higher prices. These higher prices, Robert Murray of Global Health Payment LLC explained, contribute significantly to growth in health spending.

Health insurance compounds the problem, Barak Richman of Duke University School of Law emphasized. Because most patients have insurance, often financed in part by their employers and the federal government, they are not sensitive to the cost of their care; therefore, their demand for care does not decrease as its cost increases.

Although the absence of competition in the health industry is a long-standing issue, the panelists agreed that the incentives in the accountable care organizations created by the Affordable Care Act may exacerbate the issue by encouraging further consolidation.

All event materials, including videos, are now posted.

via Big health: Consolidation and competition under the Affordable Care Act – Health – AEI.

Big health: Consolidation and competition under the Affordable Care Act – Health – AEI

AEI Event Friday, March 01, 2013 | 9:15 a.m. – 11:00 a.m.

AEI, Twelfth Floor 
1150 Seventeenth Street, NW Washington, DC 20036

US health care markets have become more concentrated over the last decade. How should policymakers ensure that the forces of competition will improve the cost and quality of health care?

Traditional antitrust enforcement tools have done little to halt extraordinary consolidation in local hospital markets, and the Affordable Care Act may encourage other health care providers and insurers to grow larger as well. Our expert panel will examine the current state of US health care competition and review policy reform options.

via Big health: Consolidation and competition under the Affordable Care Act – Health – AEI.

Christensen, Flier and Vijayaraghavan:The Coming Failure of ‘Accountable Care’ – WSJ.com

Spurred by the Affordable Care Act, hundreds of pilot programs called Accountable Care Organizations have been launched over the past year, affecting tens of millions on Medicare and many who have commercial health insurance.

The ACOs are in effect latter-day health-maintenance organizations—doctors, hospitals and other health-care providers grouped together to provide coordinated care. The ACOs assume financial responsibility for the cost and quality of the care they deliver, making them accountable to patients. With President Obama’s re-election making it certain that the Affordable Care Act will begin taking full effect next year, the number of ACOs will continue to increase.

We believe that many of them will not succeed. The ACO concept is based on assumptions about personal and economic behavior—by doctors, patients and others—that aren’t realistic. Health-care providers are spending hundreds of millions of dollars to build the technology and infrastructure necessary to establish ACOs. But the country isn’t likely to get the improvements in cost, quality and access that it so desperately needs.

via Christensen, Flier and Vijayaraghavan:The Coming Failure of ‘Accountable Care’ – WSJ.com.

Is Walgreens the Future? What a Big Pharmacy Chain’s Moves Tell Us About Obamacare | The Health Care Blog

Two-hundred-and-fifty-nine organizations have been named Medicare accountable care organizations. Most were formed by hospitals. Some were launched by physician groups.

And three were created by a pharmacy chain.

via Is Walgreens the Future? What a Big Pharmacy Chain’s Moves Tell Us About Obamacare | The Health Care Blog.

MORE DOCTORS, HOSPITALS PARTNER TO COORDINATE CARE FOR PEOPLE WITH MEDICARE

Doctors and health care providers have formed 106 new Accountable Care Organizations ACOs in Medicare, ensuring as many as 4 million Medicare beneficiaries now have access to high-quality, coordinated care across the United States

via MORE DOCTORS, HOSPITALS PARTNER TO COORDINATE CARE FOR PEOPLE WITH MEDICARE.

Provider Concentration in Markets for Physician Services for Patients with Traditional Medicare by Samuel A. Kleiner, Sean Lyons, William White :: SSRN

The geographic extent of markets for physicians is an important but little-explored issue for antitrust. Using patient flow data from a 2009 20% sample of Medicare beneficiaries, we define physician specialty-specific geographic markets for selected communities and calculate concentration within these markets. We find considerable variation in geographic market size by physician specialty and evidence of substantial concentration within physician markets, especially for specialists in smaller geographic areas. Additionally, given that our market definition methodology has been shown to define overly expansive markets, our concentration measures likely reflect a lower bound.

via Provider Concentration in Markets for Physician Services for Patients with Traditional Medicare by Samuel A. Kleiner, Sean Lyons, William White :: SSRN.