Accountable Care May Bring Savings in Healthcare Costs
One of the problems we have with Obamacare is that the exchanges are full of high deductible health plans. A high deductible health plan runs directly opposite to what we want ACOs to do."
By - Healthcare reforms have been on the rise due to new federal regulations including the stipulations of the Patient Protection and Affordable Care Act as well as the Health Information Technology for Economic and Clinical Health (HITECH) Act. A major topic of conversation throughout the health insurance and medical care fields has been an overall aim toward reducing rising healthcare costs.
With the passage of the Affordable Care Act, new healthcare models such as the Accountable Care Organization became a new way to manage the patient base, lower healthcare costs, and participate in the Medicare Shared Savings Program.
However, Accountable Care Organizations, at this moment in time, have not shown much progress in reducing healthcare costs as less than a quarter of this establishments have shared in savings within the Medicare Shared Savings Program.
Currently, many medical experts are unsure of whether Accountable Care Organizations will be able to cut spending in the long-term while others feel that it still holds promise for the industry.
To better understand whether the Accountable Care Organization leads to a slashing of healthcare costs among insurers and Medicare recipients, HealthPayerIntelligence.com spoke with Ted Schwab, Managing Director at Huron Healthcare.
HealthPayerIntelligence.com: Over the coming years, will Accountable Care Organizations lead to more significant cost savings for Medicare, Medicaid, and commercial payers?
Ted Schwab: “There’s no question about it. I think that there has been some question to date because of the failure of Pioneer ACOs and the regular MSSP ACOs to show much cost savings but what folks have overlooked is that the ACO movement has been an organizing force throughout the healthcare industry and it’s got hospitals and doctors for once under the same umbrella talking about efficiencies, clinical protocols, and ways to save costs.”
“There are now north of 700 of these organizations in the United States of America. If you think about where the industry has been for the last 100 years, it’s been a mom-and-pop fragmented industry. Now you have 700 organizations with folks at least talking to each other. It’s going to take a while.”
“We’re at the very beginning of this movement and I could not be any more encouraged.”
HealthPayerIntelligence.com: Have you seen healthcare costs dropping for patients alongside the growth of accountable care organizations?
TS: “No, it has been just the opposite. One of the problems we have with Obamacare is that the exchanges are full of high deductible health plans. A high deductible health plan runs directly opposite to what we want ACOs to do. We want people to come in more often for more care and get them to the right place.”
“We do not want people denying themselves access to appropriate care because they can no longer afford it. My goodness, if you look at a $12,000 deductible for a family of four, there’s a real incentive for somebody to not get the right type of care.”
“Unfortunately, what the insurance industry is doing and what the exchanges did is counter to everything we believe in within the ACO movement.”
HealthPayerIntelligence.com: Does patient engagement and satisfaction rise when treated through an accountable care organization? Are health outcomes improved?
TS: “There’s lots of information and data that patient satisfaction throughout the healthcare industry is not very good. We’re starting at a pretty low base. There is some interesting information coming out of clients that those who are organized around ACOs, patient satisfaction goes up, patient engagement goes up, and by far, they have much better clinical outcomes.”
“All of that will build eventually to tremendous cost savings but we’re just at the beginning of that.”
HealthPayerIntelligence.com: Do you think over time, the majority of Accountable Care Organizations will garner cost savings from the Medicare Shared Savings Program? Or does this model not make enough of a dent in reducing costs?
TS: “Yeah, I think that both the Medicare Shared Savings Program and the ACO industry will evolve. Two things will happen. We will see a massive consolidation of ACOs just like we’re seeing consolidation in the rest of the healthcare industry so folks can get to scale and use that scale to leverage efficiencies.”
“I think the MSSP program is fundamentally flawed and that it will, five years from now, look more like Medicare Advantage. The attribution model is nearly impossible to manage. You have to be able to assign patients.”
