The Emperor’s New Clothes – The Weavers

Imagine the weavers staring at the naked, royal abdomen of the emperor. They knew full well the absurdity of the situation, but once the path of deception was taken, the weavers could only compliment their leader’s fine taste in clothing.

Last week I wrote about the clothing. Now, let’s take a closer look at the weavers.

An Accountable Care Organization, as a model of healthcare delivery, embraces the core values of primary care. The stated goals of measuring performance, improving efficiency, and coordinating care are undeniably worthwhile.

Rewarding primary care physicians to reduce the cost of healthcare

remains the right idea.

The ACO has the potential to do so much good. But the weavers got involved.

Hospitals, Insurance Companies, and Healthcare Entrepreneurs could see that the reimbursement system was changing. Billions and billions of dollars would be shifting from their control. 

Time to start weaving.

If primary care physicians were to be able to control costs, then the weavers knew that they needed to be able to control primary care physicians. 

The initial model of the ACO, proposed by the Medicare Shared Savings program in January 2012, empowered primary care to form networks with other providers to organize and coordinate delivery. That was the simple beauty of the ACO. Motivate PCPs. PCPs could use data to steer patients to more cost effective resources. By saving money, the PCPs could receive greater pay themselves. That would be a win for all.

Save primary care by helping primary care save money.

The problem for the weavers was simple. If PCPs saved money by keeping patients out of hospitals, referring to less expensive consultants, or using cost effective treatments… the money that they saved might be the weaver’s money.

That would never do. After all, weavers need lots of money… you know, to weave.

ACOs threatened to change the revenue of some very powerful and influential weavers. 

Those silly PCPs, they can’t save money on their own. The weavers must help these simple PCPs. Healthcare can only be delivered by complex, multi-layered vertically integrated networks. And these networks are very expensive because… well, they are expensive.

So messages were quickly spread:

Join an ACO or perish.

Don’t miss out. Never mind the details. Pay no attention to the beta testing. You need this. You want this. You got to be in this. We’ll worry about what an ACO is later. Sign up. Structure? Distributions?Ownership? This is the latest, greatest, new thing.

And just as with the Emperor’s new clothes, “only the ignorant” can’t see the beauty.

Physician’s anxiety to join an ACO was reinforced by….you guessed it…the very companies forming the ACO.  Hospitals, Insurance Companies, Specialists Organizations, and Entrepreneurs. Vertically integrated companies that much protect their market share, increase utilization, and support massive infrastructure. The very companies that contributed to our nation’s healthcare economic crisis. They don’t want to be part of the problem, they want to help….they just need lots of money to do it. 

And who are their key targets?  PCPs.

Remember that the only medical specialty required to form an ACO is primary care. So naturally all ACOs claim to be “primary care driven”. But ask who controls the revenue, who determines the overhead, and who steers the direction of utilization? Weavers are quick to point out the beauty of the clothing. But if you can’t see it, you must be ignorant.

In order to be recognized by the Department of Health and Human Services as an ACO the network must include sufficient numbers of PCPs to provide care for a minimum of 5000 patients. All of the other members of the ACO are infrastructure, overhead, and weavers.

So, if PCPs are the core component of an ACO, why don’t PCPs form their own ACO?

I’m so glad that you asked. I’ve written enough about the weavers.

Because, after all, only the Emperor himself could stop this charade.

Next week we’ll talk about the Emperor…  and oh, by the way…  you are the Emperor.

Guy L Culpepper, MD