A paper authored by two Harvard economists argues that accountable care organizations may not be highly effective in reigning in America’s healthcare costs since providers will continue to use expensive technology.
The authors said innovative technology is a large driver for providers’ market share, and it is questionable how much ACOs will reign in the costs of these pricey technologies since physicians will still want to retain market power and provide care options their patients prefer.
ACOs might also increase market power, which could cause costs to spike. “Enthusiasm for the potential of ACOs to promote coordinated care must be moderated by their potential to increase market power,” the paper reads, “making antitrust enforcement even more important.”
The economists remain skeptical on the cost-effectiveness of ACOs, saying “[t]here is no single strategy that is likely to achieve efficient use of health resources,” according to the paper.
Read the full-length paper, “Aspirin, Angioplasty and Proton Beam Therapy: The Economics of Smarter Health Care Spending” here (pdf).
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