Is it time to restrict consumer choice again?

In a recent New York Times article, (“A Health Provider Finds Success in Keeping Hospital Beds Empty”, April 24, 2013), the author discusses an Illinois based Accountable Care Organization that appears to be having some success in reducing health care costs.

The article goes on to describe several methods the ACO is using, such as care coordination and physician report cards.  But the article also questions the sustainability of savings and points to issues outside of the hospital’s or physician’s control.   These challenges include patients seeing “out of network” providers, who may not have an incentive to control costs at all.  In fact, these other providers may still be practicing under the unrestrained fee-for-service model, where providers have many incentives to increase the volume of services provided.  This increased volume, and related increased costs, will be counted against the Accountable Care Organization’s performance numbers and may affect negatively any reward or bonus the ACO may have otherwise earned.

Now this point is not unfair.  Yes, maybe the patient goes out-of-network because the ACO physicians don’t keep convenient hours, or maybe the quality is perceived to be better elsewhere.  But maybe the patient wants to go to the doctor they know, or the one who is closest.  Should the ACO be penalized for this?

So what should we do about this?  Should patient convenience trump other concerns?  Should all of us pay, through increased premiums, so someone else can visit whichever doctor or hospital they want, regardless of costs?  What should we do as a society?

Here are some thoughts:

a)      Should insurers ban out-of-network visits, meaning no coverage for them?

b)      Should out-of-network visits be made financially unattractive, by reducing coverage to something like 50%?

c)       Is it possible to exempt the ACO from the costs of out-of-network care (and if we did that, are we rewarding the ACO whose service is poor or whose hours are inconvenient)?

d)      Is there some other option?

What do you think?

How should the system treat visits to out-of-network providers that threaten the financial performance of Accountable Care Organizations?

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