The HMO in Your Future

By John Goodman
National Center for Policy Analysis, John Goodman’s Health Policy Blog
February 28, 2011

(Brief excerpts only)

… you are likely to be in an ACO (accountable care organization) at some point in the future and it’s probably going to happen sooner than you think.

ACOs are sometimes said to be the brain child of Elliott Fisher, who heads the Dartmouth Atlas Project. But as Uwe Reinhardt pointed out the other day, the idea is actually an old idea. It’s called Kaiser Permanente.

… the non-evidence based approach of the Obama administration will force everybody into the same model.

So how do we explain the administration’s commitment to ACOs? Whether they raise or lower costs, whether they raise or lower quality, there is one thing that ACOs will indisputably accomplish. They will drive doctors into organizations where their behavior can be controlled. For the first time in our history, both the practice of medicine and the way money is spent on medical care will fall under federal control.

ACOs are the portal through which we will all march toward a truly nationalized health care system.

Use this link to access John Goodman’s full blog entry:
http://healthblog.ncpa.org/the-hmo-in-your-future/

Will accountable care organizations (ACOs) provide the portal that will lead us to a nationalized health care system?

There is a sharp contrast between ACOs as defined under the Medicare Shared Savings Program in the Affordable Care Act (ACA) and the commercial ACOs that already exist or are being formed throughout the nation.

Commercial ACOs are primarily an extension of private sector managed care models of health care financing and delivery, except with the hope of less regulatory oversight of the market concentration that they hope to gain. These organizations are largely entrepreneurial in nature (even if non-profit) with the primary goal of making money. Since virtually all stakeholders are driven by profits, these will be the predominant models of ACOs.

The government version of Medicare shared savings ACOs is merely a model to discount Medicare services and then split the savings between the providers and the government (i.e., half of a discount). Who in their right mind would want to corner that market? The government version will be a dud.

It is not the federal government through the Affordable Car Act that is going to bring us ACOs. It is the private sector. This is hardly a portal to nationalized health care, but it is a reincarnation – on steroids – of the models from the age of managed care that caused us so much distress in the fairly recent past. Any hope of cost containment will vanish as these organizations drive prices ever higher.

Our only hope to slow our outrageous health care cost escalation is to do what all other industrialized nations have done. We need to establish some form of a public monopsony through the application of a universal social insurance program. A publicly-financed and publicly-administered single payer system would be the most efficient and most equitable model.

Comment originally posted at John Goodman’s Health Policy Blog: http://healthblog.ncpa.org/the-hmo-in-your-future/comment-page-1/#comment-86801