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ACOs Have 3 Fatal Flaws, Experts Say

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In a Wall Street Journal opinion piece, Clayton Christensen, a Harvard Business School professor; Jeffrey Flier, MD, the dean of faculty medicine at Harvard University and professor of medicine at Harvard Medical School; and Vineeta Vijayaraghavan, a senior research fellow at Innosight Institute, a think tank on disruptive innovation, said accountable care organizations are based on three flawed assumptions that will ultimately cause the model to fail.

The authors believe the following three assumptions will lead to the failure of ACOs and healthcare reform:

1. ACOs will prompt physicians to alter their care delivery. "Many proponents of ACOs believe that doctors automatically will begin to provide care different from what they have offered in the past," the authors wrote. They argued that physicians need to be reeducated and retrained to provide care in an ACO, but even after that effort, "the result would be uncertain."

2. Change in patient behavior is not necessary. Providers in an ACO are responsible for their patients' care costs, regardless of where they receive care — a flaw the authors find unfair. "ACOs hold caregivers accountable without requiring patient accountability. How can this work?" the authors wrote. Patients may not comply with treatments suggested by physicians and can also choose to not share their medical history or claims data with the organization, which can be a detriment to the ACO responsible for their care.

3. ACOs will save significant amounts of money. The Congressional Budget Office estimated the savings from CMS' 32 Pioneer ACOs would be about $1.1 billion over five years, according to the authors. The authors said this is "insignificant," as Medicare's budget is $468 billion. They also said commercial organizations will provide "relatively small reductions" in healthcare spending.

More Articles on ACOs:

6 Recent Stories on ACOs and Population Health Management
ACOs Reach Half of U.S. Population
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