Ricardo Alonso-Zaldivar, AP
President Barack Obama's main idea for getting quality healthcare at less cost was in jeopardy after key medical providers called his administration's initial blueprint so complex it's unworkable. Just over a month ago, the administration released long-awaited draft regulations for "accountable care organizations," networks of doctors and hospitals that would collaborate to keep Medicare patients healthier and share in the savings with taxpayers. Obama's overhaul law envisioned quickly setting up hundreds of such networks around the county to lead a bottom-up reform of America's healthcare system.
But in an unusual rebuke, an umbrella group representing premier organizations such as the Mayo Clinic wrote the administration saying that more than 90 percent of its members would not participate, because the rules as written are so onerous it would be nearly impossible for them to succeed. "It's not just a simple tweak, it's a significant change that needs to be made," said Donald Fisher, president of the American Medical Group Association, which represents nearly 400 large medical groups around the country providing care for roughly one in three Americans. Its members, including the Cleveland Clinic, Intermountain Healthcare in Utah, and Geisinger Health System in Pennsylvania, had been seen as the vanguard for accountable care.
The medical groups say they are worried they will be left holding the bag for losses, that the government has designed things so there is no easy way to tell which patients are part of the program, and that there's no reliable way to adjust for patients who are sicker and require closer follow-up and more expensive treatments. The deadline for public comments on the proposed regulations is still weeks away, but Fisher said "we needed to get their attention early on, so (the administration) could be thinking about how major changes are needed to make these regulations viable."
Medicare spokesman Brian Cook said the agency is doing extensive outreach to explain and take feedback on the regulations and that they would carefully consider this input. "We are confident that providers' decisions on whether to participate in the program will be made on the basis of the final rule, which will reflect the feedback we receive," added Cook.
Many in the health care industry were silent partners backing Obama's overhaul law, but disappointment over the accountable care rules has put a chill into the relationship. During the congressional debate, President Obama extolled Mayo and Geisinger, holding them up as a model of what he wanted to achieve for the nation. Industry criticism of his administration's proposal has been building up for weeks in online forums.
"This has all the hallmarks of a party that nobody comes to, unless there is a serious re-thinking," said former Medicare administrator Gail Wilensky, who ran the agency under President George H.W. Bush. Wilensky said the idea of coordinating care isn't the problem, but "it sounds like (the administration) really overshot the mark."
The regulations are "overly prescriptive, operationally burdensome, and the incentives are too difficult to achieve to make this voluntary program attractive," the medical group association said in its letter. One of the major problems seems to be that medical groups have little experience in managing insurance risk, and the administration blueprint rapidly exposes them to potential financial losses.
Without major changes, "we fear that very few providers will enroll ... and that (Medicare) and the provider community will miss the best opportunity to inject value and accountability into the delivery system." Private insurers are also experimenting with versions of the accountable care idea, but successful adoption by Medicare is seen as the key to spreading it across the country. The Obama administration had estimated as much as $960 million in savings from the first three years of the program, and bigger amounts thereafter.
Fisher, the medical association head, said he does not think the administration will easily back off its approach, because on paper it saves the government money.