Sure, Accountable Care Organizations ACOs Can Save Money, But Can They MAKE Money?

ACOs at work.

According to this Bloomberg news release, some of Medicare's Accountable Care Organizations (ACOs) are already achieving cost savings. Mt. Sinai and Coastal Carolina are reducing emergency room visits while Hackensack is reducing costs.

All three institutions are using two key ingredients:

1) information technology-based risk stratification to identify the persons at greatest risk and

 2) dedicated full-time nurses who perform telephonic and in-person outreach, coordinate care and provide patient coaching that, in turn, is tailored to that risk.

To the DMCB, the good news is that ACOs are using the two approaches that define modern-day disease and population health management. That industry's success will be Mt Sinai's, Coastal Carolina's and Hackensack's success.

The bad news is that the news release only addresses half the question: did any savings exceed the institutions' cost of the risk stratification and the nurse-FTEs? If the early answer is no, then avoided ER visits and reduced costs could turn out to be much like Governor Christie's lap band: so far so good but it's still risky and could ultimately be all for naught.

And on an unrelated note, this just-published New England Journal article makes note of "not made in America" health care innovations from overseas that could hold important lessons for the United States. In particular, the authors point out that Germany's DRG hospital payment system includes 30-days of post-discharge care and includes the physician payment. Readmissions within that 30 day window are, with a few exceptions, not covered and physician payment is possible because docs are often employees of the hospitals.

"Interesting!" says the DMCB, but is reminded that Germany is hardly a model for reducing inflationary cost trends.   It also specifically recalls hearing Germany's Minister of Health, Daniel Bahr, express impatience with his country's DRG system just last week. He criticized it for not advancing enough quality in his keynote address at the HauptKongress in Berlin.

Going Long on the Patient Centered Medical Home (PCMH) Despite the Prattling Pinheads of Pessimism

Is the Disease Management Care Blog worried about the prognosis of the Patient Centered Medical Home (PCMH)?

Not in the least.

It's simply marching from its "Peak of Inflated Expectations" through the "Trough of Disillusionment." Before you decide to short the PCMH, check out this very enlightening Bloomberg editorial, Lure More Doctors Into Primary Care With 'Medical Homes.'

Noting that many commercial insurers remain committed to the medical home model of care, Bloomberg's business-savvy editorial board also points out that the PCMH has the added quality of attracting physicians to careers in primary care. The Josia Macy Jr. Foundation has some preliminary data suggesting that experience in medical home settings increases medical students' enthusiasm for primary care.

It's a timely article.  While prattling pinheads of pessimism (examples here and here) glom onto imperfect research methodologies and findings that are unequal to the task at hand, top notch organizations like Sutter, University of Pittsburgh Medical Center and Horizon Blue Cross Blue Shield are going long on the PCMH.

These guys know something that the academics are missing.

Too bad there isn't a PCMH futures market; the DMCB could make some serious money.

Image from Wikipedia