Medicare proposed more quality measures and smaller potential bonuses for its ACOs than those included in the 10 physician groups' five-year pilot with the CMS, which ended in 2010. Hospitals and physician groups have criticized the 65 proposed quality measures, bonus criteria and potential financial penalties as too much risk for too little possible return.
Other providers also called for fewer quality measures at the outset. So many quality measures present providers with “a substantial practical constraint,” argued the 17 hospital and health system CEOs in their letter to Berwick.
The Sisters of Mercy Health System—which includes St. John's Clinic, one of the 10 physician groups—said in its own letter to the CMS that potential bonuses do not do enough to offset needed investment. The system declined an interview request.
From the system's experience “we know firsthand the challenges and costs of building the necessary infrastructure, collecting, reporting and acting on the necessary clinical data and changing our clinical culture accordingly,” the Springfield, Mo.-based system told the CMS.
The AHA lobbied in its letter to increase potential bonuses to up to 80% to 90% of eligible savings, based on quality performance.
Many executives said the verdict on Medicare accountable care hinges on the final rule.
At Intermountain Healthcare, executives have been “enthusiastic about the ACO concept since it was first discussed,” Greg Poulsen, Intermountain Healthcare senior vice president, said in a written statement. “However, we feel that the initial ACO regulations fell short of the goals that had been set, especially as it pertains to institutions that already are organized to coordinate care,” he said.
Intermountain, based in Salt Lake City with 20 hospitals in two states, won't decide whether to join one of Medicare's accountable care initiatives until after final rules have been released, he said.
Methodist's Mansfield said the final rule should “rebalance your carrots and sticks in this initial overture.” Methodist officials are working to create a private-payer model but intended to ultimately apply as an ACO under the Medicare shared-savings program after laying the necessary and considerable groundwork. Once the program is established, Mansfield argued, policymakers can adopt more stringent ACO criteria. “You've got the purse,” Mansfield said. “You make the rules.”
Mansfield said he strongly believes the payment model has the potential to achieve savings and quality gains with less disruption than other likely options as lawmakers grapple with distressed budgets.
“Medicare is running out of money,” he said. “America is running out of money. Texas is running out of money. The reality that I see is one way or the other, we're not going to continue to spend the money we spend on healthcare” using taxpayer dollars.
And for that reason, some plan to give ACOs a try no matter what. “I think they are almost hard-wired for failure the way they are written,” said Dr. David Shulkin, president of Morristown (N.J.) Memorial Medical Center and vice president of Atlantic Health System.
But just as dutiful voters turn out when elections offer no attractive options, so do health systems have an obligation to pursue the promising payment model, he said. Atlantic Health System will seek to become an ACO under Medicare, as proposed or otherwise, Shulkin said. “I don't think it's responsible for us to sit this one out,” he said. “The imperative and need for change is so great that we must participate in it.”