Insurers Need to Say No to an ACO If There Is No Dr. No

The Disease Management Care Blog knows that a key ingredient for the economic success of any the health care system is the ability of someone somewhere to say "no." The only issue is who is responsible for actually saying it. Conservatives seem to prefer a perfectly transparent and competitive free market, where that job is up to the consumers. Progressives like the idea of a perfectly regulated system, where saying no is up to a responsive, objective and fiduciary board or group of experts.

And in Accountable Care Organizations (ACOs), it's going to be up to "Dr. No."

What is this apostasy, you ask? Regular DMCB already readers know that ACOs are provider organizations that are responsible for quality and cost for at least 5000 beneficiaries, possess a formal legal structure, have a critical mass of primary care providers, can report outcomes, have a central administration and promote evidence-based medicine as well as patient centeredness. ACOs also happen to be the Affordable Care Act's gamble that health care costs can be brought to heel through bundled payments and shared savings. That should be enough, right?

The skeptical DMCB doesn't think so. It suggests that while all those ingredients are necessary for ACOs, they're not going to succeed without a readily identifiable and tough "Dr. No" who is high up in the organizational hierarchy.

And who is Dr. No? The DMCB suggests this is the accomplished, seasoned and middle-aged physician-administrator who understands that ACOs are another wrinkle in the game of "risk transfer." He or she will grasp that there can be little hope of recouping the investments in coordinated care and information systems without controlling healthcare utilization. That means fewer "preference sensitive" procedures, less reliance on pricey specialty-based care and attacking unnecessary variation. That translates into using guidelines, medical evidence and crabbiness to enforce appropriate use of joint replacements, MRI scans and cardiac catheterizations. That means telling Dr. McDreamy he has to work in a standardized operating room, Dr. House that he'll need to discharge the patient and perform that follow-up testing on an outpatient basis and Drs. Nick n' Tuck to stop trying to convince the insurers that post-bariatric abdominoplasties are medically necessary.

The DMCB used to think that George C Scott's Dr. Bock character from the 1970's black comedy The Hospital might be able to fill the role of Dr. No. The DMCB changed it's mind after seeing Enoch "Nucky" Thompson of HBO's Boardwalk Empire in action. True, he's not a physician, but this gangster-politician has what it takes: being a shrewd judge of character, accepting personal foibles, able to turn on the charm when necessary and being cold-blooded when it's called for, all in the name of keeping the eye on the prize. Nucky is perfectly qualified to run an ACO.

As commercial and government insurers start getting into the weeds of contracting with newborn ACOs, the DMCB recommends that they not only ask about all that usual stuff of about monitoring quality and costs, supplying enough PCPs to service the population, using information technology and fairly distributing any upside gain shares. They will also need to ask about and meet Dr. No. If the ACO leadership doesn't understand, health insurers will need to think again. If they are introduced to Dr. No and he turns out to be a cheerful Colonel Potter (MASH), a cherry-cheeked Doogie Howser or a vacuous Dr. Dorian (of Scrubs), they'll have to reconsider the terms of the contracting.

No Dr. No? Walk away from the deal.