Verdict on Accountable Care Organizations: Disaster Ahead

See my previous post here. This is Michael Milleson writing about the new ACO regulations at Kaiser Health Care News:

In the classic fairy tale formula, a king offers his beautiful daughter’s hand in marriage and half his kingdom to the young man brave and resourceful enough to ford a dangerous stream, climb a treacherous mountain and then slay a ferocious dragon. But if Medicare were making the rules, the successful suitor would be lucky to get a goodnight kiss — if not have the door slammed in his face. Not surprisingly, the list of volunteers to become an ACO under these conditions appears to be extremely short.

Consultant Steven Lieberman, a 30-year veteran of the Congressional Budget Office, warns that the new regs could kill ACOs outright. “The proposed regulation imposes unfavorable economics, unrealistic requirements, high uncertainty and significant risks for ACOs,” he writes on the Health Affairs blog. In the same vein – and in the same venue — Ron Klar, a physician who has consulted extensively to health plans and to CMS, says the agency has created a program “likely to have few participants.”

Comments (6)

Trackback URL | Comments RSS Feed

  1. Devon Herrick says:

    The regulation of ACOs needs to be flexible enough for firms to experiment to discover what works and what doesn’t work. If the operating structure is set in stone by CMS, regulators risk getting the details wrong. We’ve often said that providers need to offer suggestions about how to improve efficiency (for which they need to be compensated). Bureaucracies dictating the practice of medicine from the top down ignores the potential for innovation that providers might otherwise discover. There isn’t just one solution — there are many solutions which would vary from institution to institution.

  2. Ken says:

    on the other hand, ACOs can’t be a disaster if nobody becomes an ACO.

  3. Ken says:

    I can’t think of a single commenter who has had anything good to say about the 423 pages of ACO regulations.

  4. Jeff says:

    ACOs have bee described as HMOs on steroids.

  5. Tom H. says:

    There is definitely disaster lurking ahead.

  6. Stephen C. says:

    Hard to believe this is really happening. ACOs are going to ruin the practice of medicine.