Wednesday, June 1, 2011

Hospitals Skeptical About ACOs

The 5/30/2011 New York Times notes, "Medicare Plan for Payments Irks Hospitals". In particular, hospitals are expressing increasing skepticism about new rules for so-called Accountable Care Organizations (ACOs) intended to encourage them to save money by "integrated care".

A couple of excerpts:
This plan has drawn fire from hospitals, which say they have little control over services provided after a patient’s discharge — and, in many cases, do not even know about them. More generally, they are apprehensive about Medicare’s plans to reward and penalize hospitals based on untested measures of efficiency that include spending per beneficiary...

Charles N. Kahn III, president of the Federation of American Hospitals, which represents investor-owned companies, said he supported efforts to pay hospitals according to their performance. But he said the administration was "off track" in trying to hold hospitals accountable for what Medicare spends on patients two or three months after they leave the hospital.

"That's unrealistic, beyond the pale," Mr. Kahn said.
(Read the full text of "Medicare Plan for Payments Irks Hospitals".)

The push towards government-supervised ACOs represent a top-down "central planner" approach towards health care, with government carrots and sticks used to incentivize hospitals to follow government "quality" guidelines.

This approach ruined the Eastern Bloc economies during the Cold War. Why should we expect it to do any better for American health care?