Accountable Care Organizations and the Medicare Fee-For-Service System
In early August I sat in a meeting that radically changed my understanding of how Medicare Advantage insurance providers in Tennessee compete to enroll you in their health insurance plans. We all know the Health Care industry isn’t known for it’s stellar reputation in cost management, invoice transparency and all around efficiency, but at the core of the supplement insurance service are groups of men and women, some of them seniors themselves, fighting to compete and provide as many benefits, at as low a cost, as possible. One particular type of organization, called Accountable Care Organizations, are only compensated if they are successful in saving you money!
One of the unintended consequences of Medicare’s “fee-for-service” system is a system that isn’t directly related to the quality of the care, but rather the quantity of the care that health professionals provide. Even if the additional care isn’t necessary, the incentive leans towards providing it regardless. Tennessee ACO’s exist to change that incentive structure, not by doing away with the fee for service model, but by offering bonuses to providers that keep their total costs down. In most cases, the ACO isn’t compensated unless it is successful in improving the efficiency of care and assisting doctors and providers with keeping their patients healthy and out of the hospital. Again, tipping the incentive to improving your quality of care and not just the quantity. Great for you, great for the providers and great for doctors!
So what does this Mean for you?
This means, there are organizations in your area fighting for these savings, and you may or may not be reaping the benefits. Start by asking your doctor if they are members of a Tennessee Accountable Care Organization and weigh the possibility of joining a Medicare Supplement Insurance plan that has doctors in network with an ACO. Having a hands on, informed approach to your own health insurance is the best way keep yourself up to date on any savings opportunities in your area. As ACO’s gain in popularity keep yourself informed of Tennessee ACO’s in your area and the savings that could be available if your doctor is in the ACO network. Keep in mind, not all ACO’s are created equal. As easy as, “improve efficiency” is to say, actually accomplishing demonstrable savings isn’t easy. This report from last January shows that out of 114 Accountable Care Organizations in the shared savings program only 29 created enough savings to keep some of it. ACO’s that are unable to provide cost savings for you run the risk of having to absorb all of their administrative costs and some could even face penalties.
Some Tennessee Accountable Care Organizations:
Methodist Le Bonheur Healthcare (Memphis, Tenn.)
MissionPoint Health Partners (Nashville, Tenn.)
The Physicians Accountable Care Organization (Middle Tennessee)