HLTH 385 Lecture 17: Lecture 17
21 May 2018
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• Will there be a shift away from Fee For Service
• Accountable Care Organizations
o Way for providers to contract with the Medicare program
o Voluntary (providers can chose)
o Providers must care for at least 5000 patients (5000 beneficiaries)
o Bonus tied to cost savings
• One-sided: eligible if actual costs are below expected costs, and no
penalty if actual costs are above expected costs
• Two-sided: similar to one-sided but penalties are eligible
o Bonuses tied to quality not just cost
o Attribution
• Medicare attributes beneficiaries to different ACOs (usually based on
where they're receiving the majority of their care
• Usually doesn't happen until the end of the year
o Open to hospital, primary care physicians, etc.
o Physicians can sometimes receive bonuses by participating in ACOs
o ***Helps to take care of a lot of patients just in case you're attributed one
that consumers a lot of healthcare, brings your overall average spending
down, so your chance of getting a bonus is not at risk
• ACOs lead to consolidation
o Measure and report quality
o Larger organizations (those that care for more patients) are better to bear risk
***
• This is why there is the rule for ACOs that the organization must care for
at least 5000 patients
• Same is true for insurance companies
• This is why ACOs are pushing organizations to consolidate (merge)
• Provider owned plan
o Ex) Kaiser
o Easier to coordinate care (ex- like people who see multiple doctors, this
makes it so all physicians work for same organization)
There are advantages to provider organizations getting larger, but there are also
problems (like diminishing competition)
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