The U.S. health care system encompasses myriad delivery and payment structures, with each uniquely shaped by the economics of the ultimate payer—whether that payer is the government, employers, or consumers. This complex system developed as a result of regional variances, historical programs and patterns, political attachments and influences, and payer and product capabilities.
Each structure includes both a payment model and a care model. However, the government has historically enforced certain separations between reimbursement and care/referrals for care, with payers retaining primary responsibility for financial aspects and providers retaining primary responsibility for clinical outcomes. For example, Stark legislation and anti-kickback rules of the early ‘90s heavily regulate providers’ investments and ownership in health care services, and additional regulations limit non-clinician interventions in clinical decisions. Rules like these are designed to protect patients from fraud and abuse, such as a physician recommending (or being financially incented to recommend) unnecessary services to earn more money or a payer refusing necessary services to save. However, they can also inhibit a market where all parties work together to seek high-quality care at an affordable price.
In contrast to the traditional approach, accountable delivery systems carefully merge reimbursement and care models to achieve this rational market for care, with providers actively considering the costs of various treatments and payers accounting for clinical considerations in addition to the bottom line.
There are multiple accountable care structures across the private and public sectors:
- Private integrated delivery network
- Private exchanges
- Employer-led accountable care organizations
- Shared-savings and pioneer accountable care organizations
- Integrated delivery networks in Medicare and Medicaid
- Medicare Advantage with physician at risk
- State insurance exchanges
- Medicaid health maintenance organizations
- Bundled payments
Although specific features of these structures vary, they have six common attributes:
Shared responsibility – In an accountable delivery system, payers, providers, and patients each play a key role in ensuring optimal health and cost outcomes.
Coordination of care – A key benefit of an accountable delivery system is the successful coordination of patient care across the continuum, led by a physician who accepts responsibility for certain quality and cost outcomes. For most patients, the accountable provider is a primary care physician. However, patients with a severe or chronic illness might have a specialist who leads care coordination efforts.
Aggregation of services into larger constructs – In a traditional health care model, physicians manage individual episodes of care. In accountable care, they must consider not only each individual encounter but also how to manage a patient’s care over time in a partially or fully capitated payment structure, as well as the health status of entire patient populations.
Dependence on technology – Accountable care systems require health information technology tools to connect and inform the enterprise, such as data warehouses, advanced clinical and financial reporting, and electronic medical records. The importance of technology cannot be overstated. When past accountable care initiatives have failed, such as capitation in the 1990s, lack of technology has been a significant contributing factor.
Intense regulatory environment – The government closely monitors accountable delivery systems for problems such as conflict of interest and denial of care. Regulations are more intense in government-funded models, but all accountable systems are subject to enhanced scrutiny as they closely combine reimbursement and care functions.
Financial incentives – To drive optimal decision-making, accountable delivery systems require value-based contracts with aligned incentives. The appropriate contract structure varies from group to group depending on a number of factors, but the goal is to share risk with providers to create additional motivation to meet cost and quality goals.
In the weeks ahead, we will explore the most common accountable care systems in-depth in a series of papers on ADSI. Look for features on: