As a result of the federal government’s push towards a value-based healthcare system, physicians and other providers are under increasing pressure to find ways to improve patient health outcomes and reduce costs. One way the feds seek to address these goals is through accountable care organizations (ACOs); in January, the Obama administration said it wants 30 percent of traditional Medicare fee-for-service payments tied to a quality-driven, alternative payment model, such as an ACO.
Nonetheless, research shows that physicians remain uncertain about the structure and effectiveness of these paradigms. Prior to the U.S. Department of Health and Human Services’ (HHS) aforementioned announcement regarding value-based care, the 2014 Physicians Foundation Biennial Physician Survey released last December found that while physicians are informed about ACOs, they are still not convinced of their effectiveness. The survey from the Foundation, a nonprofit organization focused on supporting physicians in sustaining their medical practices and navigating healthcare reform, found that: a majority of physicians (52 percent) do not participate in ACOs; more than a third (36 percent) of physicians believe ACOs are unlikely to increase quality and decrease costs; 31 percent of physicians are unsure about the structure or purpose of ACOs; and 19 percent of physicians believe the quality/cost gains will not justify organizational cost effort.
According to Joseph Valenti, M.D., board member of the Foundation and a practicing obstetrician/ gynecologist at the Denton, Tx.-based Caring for Women practice, plenty of physicians are having their fair share of problems with the process that is behind ACO arrangements, and on a larger scale, the entire shift to value-based care. Valenti, who has 13 years experience in the private practice arena, recently spoke with HCI Associate Editor Rajiv Leventhal about these physician challenges, and what he thinks can be done to better the system. Below are excerpts of that interview.
Why are physicians uncertain about ACOs?
I think that a lot of physicians are not completely convinced that the data is out there to demonstrate that they could potentially develop the savings necessary, and prevent hospital admissions and readmissions. Much of the healthcare spending that is extreme right now is in hospitals, not clinician offices, so the concern is, can you keep this person out of the hospital? Also in terms of Medicare ACOs, you’re going to be assigned 5,000 patients at least, and they could be the sickest patients out there, so there is no guarantee that you can make them well enough and be assured that they don’t need to come back to the hospital. So maybe you can’t demonstrate shared savings. And the ACO stats prove this; one-third of them are working, one-third are breaking even; and one-third are leaving the program.
Joseph Valenti, M.D.
How do you suggest the process improve?
Well, I don’t think that ACOs are the only way to increase quality and decrease costs. Many of those same things can be accomplished by an MSO (management services organization) with negotiation with an insurance company—without the ACO component. As far as ACOs in general, it will be hard to entice people to get people involved in one especially if there will be a potential downside. When they structured these things, they had different tiers, and the highest shared savings also involves some loss of money if you go the other way, and that’s a problem.
I think one of the other problems is that because when the government mandated electronic medical records (EMRs), they didn’t mandate that they would be able to communicate with each other. This EMR transition has been really difficult for a lot of people; our survey verifies that many are unhappy with them. They like their ability to access information from anywhere, but the transition over is difficult. They’re not happy that it doesn’t communicate with other doctor or that the informatics doesn’t match exactly match what insurance companies and Medicare want with regards to reporting. As a result, many practices can’t even stay open. ACOs by their very nature involve consolidation, and not everyone is thrilled with the pace of patient care and what that might mean for consolidation. So I think the difficulty is that in convincing people to go an ACO, no one has completely convinced anyone thus far that it will enhance care markedly for patients. Physicians are really uncertain about that.
What would be your pros and cons for joining an ACO?
We have never been approached to become an ACO, though I think the concern about shared savings is that if you’re already doing a really good job managing patients, and you are doing it as efficiently as you can, where is the savings going to be? People are having a hard time grappling with that. I think the savings are in hospitals, but of interest, I don’t see the hospitals getting rid of things where they get paid two to three times as much to do something in hospital as we get paid in the office. The incentives are really backwards in some ways to incentivize them to get involved, especially for those who are already practicing medicine as well as they can. Now if you have a very large group of Medicare heavy patients, and you have the ancillary help and midlevel practitioner help to follow up constantly, then you can do that. But that’s often not the case.