Tuesday, November 20, 2012


The latest hot ticket item in healthcare now that the presidential election is over is the implementation of the most controversial aspects of the Affordable Care Act (ACA), namely, the individual mandate to buy health insurance, or else. Health insurance exchanges are ready to make their move as are specific Accountable Care Organizations (ACOs).

ACOs will be comprised of hospitals,  primary care physicians, and specialists who are supposed to accept being held accountable for the cost and quality of the healthcare they provide. Fiscal carrots is the name of the game because providers will continue to be paid on a fee-for-service basis and will share in whatever revenue is brought about by whatever cost-savings techniques the ACOs use, e.g., not accepting doctors who have too many elderly patients  or patients with expensive chronic diseases. The days of searching out rare and unusual diseases to care for are over: these unfortunates will be obliged to find  whatever comfort is available under the nearest bus. If the ACO is well managed from a fiscal perspective, providing participants will share in  the savings  as a second source of income. Quietly, with as little fanfare as possible, physicians and hospitals will be encouraged to avoid the sickest, oldest, and most complicated patients. Meanwhile, the ACA calls for expanding Medicaid despite a looming shortage of doctors.

Medicaid is supposedly administered on a state-by-state level. In June of  2012 the Supreme Court (SCOTUS) gave states an option to keep their Medicaid programs as is or expand them. So far, however, only 17 states and the District of Columbia have said they'll develop their own exchanges. Increasingly, therefore, it appears as though the federal government will pick up the exchanges by default and with it increased control of medical care.

Medicare cuts in the amount ot $716 billion are ready.  President Obama said he wouldn't cut Medicare itself, just the fees paid to all of the providers. Physicians, already getting only 18 cents on the dollar, will not be overjoyed and many are likely to stop accepting new Medicare patients.

Here's a comment from HHS: "The Department and its partners should be vigilant in identifying ... emerging fraud, waste, and abuse risk areas across all ACA-related programs ... this will require a comprehensive approach to program integrity that integrates effective front-end program gatekeeping (itlaics added)."

In 1998 this writer spoke at the White House in a press conference with then President Clinton. "Gatekeeping" was exposed as a mechanism to reduce patients' access to care. HMOs, seeing the handwriting on the wall, reformed their "gatekeeping" methods. Now, under the ACA, we're seeing new scribbling on the wall that'll enable return of the "gatekeepers."

Beware, patients: your illness may be your ticket to the hoosegow. Not to worry, though, your doctor will be in a near-by cell. The accusations will be "fraud" and "waste."

When your ACO contract arrives, you will need advice about what to do. Your first problem will be where to get that advice. Not to worry. In due course a new legal specialty will emerge.


  1. All these organizations are set up to decrease govt expenditure on ballooning healthcare costs. Unfortunately the ACO will be run by corporations who want to make easy buck at the expense of the doctors. People who are going to get benefit are the middle men , corporate entities and healthcare profiteers who will siphon of the healthcare dollars . I have already read that Ca attorney journal is examining the Anti Trust law implications on California ACOs

  2. The possibility is that some of the ACOs will run afoul of RICO -- I believe your reference to the California Attorney General is correct. We'll want to follow-up on this item. -- RLW, Editor

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