In its quest to remake the nation’s health care system, the Obama administration has urged doctors and hospitals to band together to improve care and cut costs, using a model devised by researchers at
Dartmouth College.
But Dartmouth itself, facing mounting financial losses in the federal program, has dropped out, raising questions about the future of the new entities known as accountable care organizations, created under the Affordable Care Act.
The entities are in the vanguard of efforts under the health law to move
Medicare away from a disjointed fee-for-service system to a new model that rewards doctors who collaborate and coordinate care.
Medicare now has more than 400 accountable care organizations, serving eight million of the 57 million Medicare beneficiaries. Obama administration officials say the new entities are saving money while improving care, but some independent experts have questioned those claims.
“There’s little in the way of analysis or data about how A.C.O.s did in 2015,” said Dr. Ashish K. Jha, a professor at the Harvard School of Public Health. “The results have not been a home run.”
In addition, he said, “there is little reason to think that A.C.O.s will bend the cost curve in a meaningful way” unless they bear more financial risk, sharing losses as well as savings with the government.
An evaluation for the federal government found that Dartmouth’s accountable care organization had reduced Medicare spending on hospital stays, medical procedures, imaging and tests. And it achieved goals for the quality of care. But it was still subject to financial penalties because it did not meet money-saving benchmarks set by federal officials.
“We were cutting costs and saving money and then paying a penalty on top of that,” said Dr. Robert A. Greene, an executive vice president of the Dartmouth-Hitchcock health system. “We would have loved to stay in the federal program, but it was just not sustainable.”
Dr. Elliott S. Fisher, the director of the Dartmouth Institute for Health Policy and Clinical Practice, said: “It’s hard to achieve savings if, like Dartmouth, you are a low-cost provider to begin with. I helped design the model of accountable care organizations. So it’s sad that we could not make it work here.”
The idea of accountable care organizations and the name are generally traced back to a paper in 2006 by Dr. Fisher and colleagues at Dartmouth and its medical school. Writing in the journal Health Affairs, they reported that Medicare beneficiaries received most of their care from doctors who were directly or indirectly affiliated with a local hospital.
Rather than trying to measure the performance of individual doctors, they said, Medicare should assess the hospital and the doctors together and hold them jointly accountable for the cost and quality of care provided to a defined group of Medicare patients.
In effect, this was an effort to overcome the fragmented nature of most American health care and to replicate some of the benefits of managed care while still allowing Medicare patients to visit any doctors they wanted.
The new entities, unlike health maintenance organizations, “can’t tell you which health care providers to see” and “can’t limit your Medicare benefits,” the Obama administration tells beneficiaries. But, it says, doctors and hospitals working together in an accountable care organization can share information, including test results and prescription drug data, so it is easier for them to coordinate care for patients.
This result is the outcome of muddled thinking. True cost savings and reductions in fees would not be known for some time. They also exclude the organizational costs and information technology (software development) to administer the new organization.
Accountable care organizations are one of many demonstration projects being conducted by the
Center for Medicare and Medicaid Innovation, an office created by the Affordable Care Act to test new ways of financing and delivering care. Under the law, the secretary of health and human services has sweeping power to expand such projects nationwide if she finds that they would reduce Medicare spending without harming the quality of care.
The center is testing new ways to pay for prescription drugs, medical devices,
cancer care, hip replacement surgery and many other services.
The Congressional Budget Office predicts that the center’s activities will save $34 billion over the next 10 years, although it does not know which projects will save money.
Bottom line:
We want you to reorganize to save money, and we will penalize you if you don't or cannot. (CMS Center for Innovation)
Dropout by Dartmouth Raises Questions on Health Law Cost-Savings Effort - The New York Times
