Is Accountable Care Just a Remake of Failed HMOs?

Healthcare providers are buying heavily into new care initiatives, like accountable care organizations, bundled payments and risk-sharing contracts, but according to a new article in the Journal of General Internal Medicine, these may ultimately be repeating past flawed strategies.

David Himmelstein, MD, and Steffie Woolhandler, MD, are primary care physicians based in New York and authors of the article. They said fee-for-service has led to perverse incentives for a long time, but "capitation risks making things even worse."

For example, in the 1970s and 1980s, policymakers championed the use of health maintenance organizations, better known as HMOs, as an alternative to fee-for-service or universal healthcare. HMOs paid providers a fixed fee and increased financial risk-sharing among patients, providers and others in the delivery system. However, HMOs fell out of favor because they limited patient choice and forced some physicians to deny some care, especially for those with unprofitable illnesses, the authors wrote.

According to today's accountable care structures, the authors fear the same results will proliferate, namely upcoding of patients' diagnoses to receive higher fixed payments and manipulation of quality scores. Drs. Himmelstein and Woolhandler said new payment and patient care models need to focus on restraining costs and minimizing "the opportunities for profit and the risk of loss."

"Payment reform should focus not on manipulating greed, but on dampening it," according to the article. "Then the real motivations for good doctoring — altruism, social duty and the glow we feel when we help our patients — can flourish."

More Articles on Accountable Care:
Paying for Population Health: Why Rewarding Value is Key
5 Myths Surrounding the Business of Population Health Management
ACOs: The Least Agreed-Upon Concept in Healthcare?

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