The Continuing ACO Debacle
Amidst continued and sustained criticism about the overly strict regulatory requirements placed on proposed new accountable care organizations (ACOs), the Administration today embarked on a “re-launch” in an attempt to salvage its troubled proposal. Among the initiatives being contemplated is an “advance payment initiative” by the Center for Medicare and Medicaid Innovation to provide “access to the capital needed to invest in infrastructure” to create an ACO. As a reminder, the Center for Medicare and Medicaid Innovation was given $10 billion in mandatory funding by the health care law to carry out its efforts – and a significant portion of that funding could be used to fund provider groups seeking to form ACOs.
Given the multiple letters coming from the provider community about the mass of regulations and mandates placed on ACOs in the proposed rule, some may wonder whether this latest initiative represents an attempt to “throw money” at a problem that should instead be resolved by federal officials not taking such a heavy-handed approach. Paying providers to do what they might have done anyway in the absence of onerous mandates may strike some as a questionable use of federal taxpayer dollars.
More broadly, this ongoing episode illustrates how a top-down approach to health “reform” will not achieve its intended objectives, resulting instead in both increased regulations and increased costs. Just a few short weeks ago, CMS Administrator Berwick proclaimed that ACOs “are not just a new way to pay for care. They are a new model for the organization and delivery of care.” Just over a month later, even the Administration has been forced to admit that its approach involving heavy regulations will impede innovation – a cautionary tale for the entire 2700-page health care law.