Can accountable care organizations lower costs and improve quality?

Somewhere in the Obama Administration, there is an elitist central cabal that operates with the support of the highest organs of our central government. It conspires in windowless basement rooms to plot the gun control, mass vaccinations and the nationalization of key U.S. economic sectors like automobile and chardonnay manufacturing.

Healthcare, however, is its maximum target. Much like pieces on a chess board, and with the support of renegade organizations like the Commonwealth Fund, the New England Journal and UNICEF, it wants to arrange hospitals and providers into regional klepto/monopolies that coordinate care, deprive us of access to breathing as well as dialysis machines and suck up tax dollars faster than Ms. Pelosi can say “but we’re saving money!”

Just kidding, but it does seem to the Disease Management Care Blog that a lot is riding on the concept of large, regional and risk-bearing “accountable care organizations” (ACOs) that can reconcile cost and quality. And don’t think that there isn’t a hospital CEO, academic medical center Board or a medical school Dean that isn’t lusting over the prospect expanding and consolidating their local empires under the guise of Obamacare and enlightened not-for-profit community service. Ask these healthcare potentates, and they’ll tell you that this is the wave of the future, where size, access to capital and rationalized central planning will finally break the back of health care inflation and those evil insurers. It’s Wal-Mart, it’s Amazon, it’s the electronic record, it’s inevitable, right?

It’s easy to think that is the conspiratorial purpose of the Central Committee’s minions when it comes to small independent PCP clinics. And thanks to the travails of managed care, Medicare’s SGR, competition over Botox parties, poaching of patients by Convenience Clinics and dismay over Concierge Practices, what’s left of primary care is ready to be swept up into ACOs, right?

Maybe not so fast, according to an article appearing in the July 3 issue of The Economist. Dubbed “The Click and the Dead,” it describes the double whammy of transparent e-commerce pricing and economies of scale that slaughtered smaller book stores and travel agencies. However, it turns out that the very smallest book and travel shops with low numbers of employees, lean overhead and special service niches thrived despite the fierce competition from the Internet and big business.

Which is why the DMCB thinks some primary care practices will consolidate and many will become aligned with bigger health care systems. However, a considerable percent that remain small, minimize costs and, most of all, provide high customer value (defined as a combination of service and quality) could continue to thrive.

The DMCB has opined before about reports of the death of small practices being an exaggeration. Maybe it’s wishful thinking, but this article in The Economist is another reason to keep an open mind.

Jaan Sidorov is an internal medicine physician who blogs at the
Disease Management Care Blog.

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