Health Care Providers, Insurers Raise Questions, Concerns About ACOs
Physicians and hospitals are raising concerns that forming accountable care organizations, as promoted under the federal health reform law, might breach antitrust and anti-fraud laws, Kaiser Health News reports. Meanwhile, insurers are worried that ACOs could increase the cost of medical care.
Health care representatives discussed the issues on Tuesday at a meeting in Baltimore conducted by the Federal Trade Commission, CMS and the HHS Office of the Inspector General.
The reform law encourages the formation of ACOs, which pushes various physicians and hospitals to work together in order to provide more efficient and less costly care. Whether ACOs function properly could determine if the reform law succeeds in lowering costs and improving care, KHN reports. ACOs will begin qualifying for Medicare incentive payments in 2012, while certain health systems around the country already are working with private insurers to develop similar models.
However, health care providers are wondering whether ACOs will be criticized for undermining competition or driving up prices when bargaining with insurers. Members of the insurance industry also are concerned that ACOs could use their strengthened negotiation position to demand higher prices.
In recent weeks, hospitals and physician groups have asked federal regulators for "user friendly" guidance to ensure their ACO models do not violate federal laws.
Chet Speed, vice president of policy at the American Medical Group Association, said, "ACOs could transform the way care is delivered and financed and we want the government agencies to take a fresh look at how anti-trust and anti-fraud laws apply."
In addition, hospitals recently requested that HHS explain how physician-hospital ACOs can be waived from fraud and abuse regulations.
However, America's Health Insurance Plans in a recent letter cautioned that ACOs will not help consumers "if they are mere vehicles for price fixing or aggregating market power, and the antitrust agencies must continue their efforts in this area, using enforcement, guidance and other tools."
Cory Capps, an economist at Bates White Economic Consulting, said, "We could end up" with a system where providers generate "greater pricing power."
Susan DeSanti, director of policy planning at FTC, said the agency is working with CMS on guidelines for forming ACOs. She said, "The antitrust laws are actually consistent with the goals of ACOs" because they "encourage collaborations when they are going to produce good things for consumers, like improved health care, and the only caveat is that the creation of market power shouldn't go along with that." She added that "antitrust is not a barrier here" (Galewitz/Gold, Kaiser Health News, 10/5).
In addition, FTC Chair Jon Leibowitz said his agency will look into creating new antitrust safe harbors and an expedited review process to help facilitate the development of ACOs (Modern Healthcare, 10/5).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.