ACOs Don’t Pay
Investors creating ACOs are unlikely to profit from them:
The current Medicare Shared Savings Program anticipates a minimum performance period of only 3 years. An ACO making the mean initial investment of $1.7 million will require the unlikely margin of 20% for the 3-year period envisioned by CMS.
Doctors do not fare well either:
- The available data indicate that 8 of the 10 Physician Group Practices in the demonstration did not receive any shared savings payments in year 1.
- In the second year, 6 of the 10 practices did not receive such payments,
- And in the third year, half the participants were still not eligible for any shared savings to offset their initial investment.
HT to David McKalip.
Aaah, …. now the dirty little secret is revealed. ACOs don’t work!!!
And to think I just read a press release about a Commonwealth Fund study that suggested… “If implemented successfully, accountable care organizations (ACOs) have the ability to achieve better care, better population health, and lower costs…”
That’s a big “if”!
Note the emphasis on population, not individual, health in the Devon’s Commonwealth quote.
How does one create a healthier population? Let the sick people die. Saves money, too.
This is what we often refer to as poorly aligned incentives.
It’s almost as if this were some cruel hoax.
This reminds me of Linus, Lucy and the football.