Accountable Care Organizations (ACOs)

An ACO is a network of doctors and hospitals that shares responsibility for providing care to patients. Hospitals, physician practices and insurers across the country are announcing their plans to form ACOs, not only for Medicare beneficiaries but for patients with private insurance as well. ( ) ACOs would make providers jointly accountable for the health of their patients, giving them strong incentives to cooperate and save money by avoiding unnecessary tests and procedures. ACOs would create savings incentives by offering bonuses when providers keep costs down and meet specific quality benchmarks, focusing on prevention and carefully managing patients with chronic diseases. In other words, providers would get paid more for keeping their patients healthy and out of the hospital. ( Ibid: see above link )

All of this rhetoric is just another part of a decades-long attempt by payers, both private and public, to interfere with the functioning of the doctorpatient relationship. This concept/reality of ACOs inserts the dollar bill into the doctor’s thinking and completely conflicts the functioning of the doctorpatient relationship, just like HMOs did in the past. Why do payers try to do this, to influence the doctorpatient relationship? Because that is where the money is spent. This relationship is the proximal cause of dollar spending within a healthcare system. If you contol this relationship, then you control medicine. A dollar quest is destroying sound, ongoing, non-conflicted clinical decision making in America.

Accountable care organizations take up only seven pages of the massive new health law yet have become one of the most talked about provisions. ( Ibid: see above link ) Who wrote these provisions into the Affordable Care Act ( ACA )? It certainly wasn’t the politicians. They didn’t even read the ACA before they signed it into law. So, just who is it that writes this stuff into federal legislation and for whom do they work?

Interference with the functioning of the doctorpatient relationship by payers offering financial incentives to reduce the ordering of tests; to reduce hospitalizations; to reduce referrals to specialists is every bit as conflicted as any doctor, who does unnecessary procedures to enhance his/her own income. The words, sound, ongoing, non-conflicted doctorpatient relationships, have ceased to be part of our medical lexicon because of this blind quest for dollars.

The duty of doctors in the American healthcare system is to develop a sound, ongoing, non-conflicted doctorpatient relationship with each patient they see. The combined efforts of both doctor and patient develop this mutual trust, through which non-conflicted clinical decision making occurs. The doctor’s job is NOT to reduce hospital costs. The doctor’s job is non-conflicted clinical decision making for each individual patient. If a doctor can help a hospital by trying to increase efficiencies, such as same-day admission for elective surgeries and other procedures, or perhaps discharging a patient a day or two earlier provided that out-patient follow up with the doctor can be arranged without significant hardship for the patient and provided that the doctor envisions a very early post-discharge office follow up to be the same or superior to the hospital follow up that would have occurred, then that is fine. HOWEVER, WHAT MUST NOT OCCUR is alteration in clinical decision making to satisfy the financial needs of the hospital or of the patient’s public/private 3rd party payer.

Doctors can avoid this conflicted situation by :

1) NOT working for any hospital, integrated healthcare system, HMO, or healthcare management plan. They must keep themselves INDEPENDENT from these employers. That way, these employers will not have a hold over them. The patient is and needs to remain the doctor’s sole employer.

2) NOT accepting any payment from any 3rd party payer. This does NOT MEAN refusing to see patients, who use these 3rd party payers. In my view, a doctor should see any patient, who wishes to be seen. The patient needs to be told up front that he/she is responsible for the bill. This does NOT MEAN demanding up front payment or demanding payment all at once. It does mean letting patients know the doctor’s charges; establishing an EASY, REASONABLE payment plan for each patient; and providing the patient with documentation of his/her visit(s) and/or procedure charges, so that reimbursement from the 3rd party payer can be acquired by the patient. I believe the vast majority of patients, who trust their doctor and recognize the doctor’s clinical expertise and hard work, will keep up with regular payments for an EASY, REASONABLE payment plan, which they have participated in developing with the doctor’s office staff.

Just think doctors: No more insurance company or public payer paperwork!

Hospital administrators need to get this message: Step Back! Stop trying to buy/control doctors and their practices. Your dollar profit is a distant secondary goal behind sound, ongoing, non-conflicted clinical decision making. In fact, since the vast majority of hospitals in America are not-for-profit, their billing departments need to be transparent and report the very lowest possible, break-even prices for all hospital services, based on STANDARDIZED OVERHEAD ACROSS THE ENTIRE COUNTRY.

All 3rd party payers need to get this message: An independent doctor is autonomous and not beholden to you. Each individual patient is his/her employer. Take your propaganda and other insidious, financially based healthcare manipulations such as medical homes; primary care services; accountable care organizations; bonus payments for certain appropriate goals; potentially avoidable complications; and all your other verbiage and put them in the garbage, where they belong.

Healthcare reform in America will come a long way, when doctors return to concentrating on practicing medicine, i.e., establishing trusting, professional relationships with their patients, and when they refuse to any longer be the employee of any hospital, integrated health system, other care plan and refuse to accept payment from any 3rd party payer.

Future posts will include discussion of how I believe doctors should approach billing, including reasonable charges; and of hospital charges vs. true costs based on standardized overhead expenses.

R. Garth Kirkwood, MD

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