ACOs Request Delay On Quality Penalties: Setback Or Wise Waiting?

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Does your doctor or hospital deliver good care?

Most of us answer that question based on our experience. You like your doctor or you don't. You feel better after seeing the doctor or having something done at the hospital, or you don't. Sometimes we ask family members or friends for their opinion.

Beyond that, it's hard to find out which providers do their jobs well. In health care, we walk into a doctor's office or a hospital and assume we're going to get good, hopefully great, care. But in reality, there's very little information to back up that assumption. It's like walking into Bloomingdale's and assuming that the black sweater with a $1,200 pricetag is 100% cashmere, even though there's no label. It could be high end goat's wool or a polyester blend.

Hospitals and doctors are expanding efforts to measure the quality of their care. And insurers are in the early stages of paying doctors and hospitals based on how well they do their job. One of the main experiments is happening in Medicare and five Boston health care groups are in the spotlight. Atrius Health, Beth Israel Deaconess Care Organization, Partners HealthCare, Steward Health Care and Mount Auburn Cambridge Independent Practice Association are among 32 Pioneer Accountable Care Organizations (ACOs) that are supposed to be setting a national example for how to save money while improving care.

Except, there's a setback, or at least that's how some consumer groups read this letter from the Pioneers to Medicare.

(I saw the letter in the Washington Post, they credit Inside Health Policy.)

In it, the Pioneers recommend revising Medicare quality metrics and delaying, until next year, any penalties or bonuses based on quality measures. Some consumer and employer groups say it's time for hospitals and doctors to be held accountable for their care and oppose the delay.

"I'm really disappointed that the ACOs aren’t ready to go to be paid for performance,

Health Care for All director Amy Whitcomb Slemmer
Health Care for All director Amy Whitcomb Slemmer

not ready to be paid based on outcomes (for patients)," says Amy Whitcomb Slemmer, executive director at Health Care for All. "It's a missed an opportunity to save some money," she continues. "To delay a year of performance-based pay may miss a year of savings and better integrated care for the patients."

Dr. Stuart Rosenberg, Beth Israel Deaconess Care Organization
Dr. Stuart Rosenberg, Beth Israel Deaconess Care Organization

But "are we better off getting the metrics wrong and tying them to money?" asks Stuart Rosenberg, co-chairman of the Beth Israel Deaconess Care Organization, "or delaying just one more year and getting it right?"

Rosenberg gets a little worked up as he speaks. "We'd just as soon get it right in and start in '13," he says. "But if we can't get it right let's not mess things up by getting it wrong and then having a real mess on our hands."

The Pioneer ACOs say they didn't know how Medicare would measure quality before they signed onto the program. Now that Medicare has set the bar, providers say it doesn't make sense for some quality measures.

Take a "falls risk assessment." Medicare has decided the Pioneer providers must assess 90% of all their Medicare patients, to see if they are likely to fall at home or in a hospital, if providers want the full payment for that measure.

"We've got many healthy Medicare patients," says Emily Brower, executive director of

Emily Brower, Atrius Health
Emily Brower, Atrius Health

Accountable Care Programs at Atrius Health. "They're out playing golf every day, walking, playing with their grandkids. Asking them to do this assessment every year, there's no evidence for it, and it could be a waste of resources."

Brower agrees with Rosenberg that the intent of the letter is to make sure that the quality measures are right.

We're heartbroken," says Brower, "that people interpreted this as us not wanting to be measured. What we want is good, robust measurement right from the start because it's that important."

But Brower acknowledges that it may take more than one additional year to reach an agreement with Medicare on each quality measure in this Pioneer ACO experiment. The 32 participants have told Medicare they have to know before April 2nd if the agency will work with providers to revise the quality goals.

The Centers for Medicare and Medicaid Services declined comment on the Pioneers' request.

"I would put my money on the hospitals this round as the federal government wants to prevent this early pilot ACO project from falling apart," says Josh Archambault, director of health care policy at the Pioneer Institute.

This disagreement, says Archambault, "puts the spotlight on the cost and quality improvement claims ACO supporters have promised." And "it foreshadows the battles that lay ahead over quality metrics," he adds.


Some business leaders have a stake in connecting payments to doctors and hospitals with the quality of that care as soon as possible.

"Businesses have been implementing consumer-driven health plans with the expectation that better performance measurements will become available from providers," says Philip Edmundson, CEO of William Gallagher Associates, New England's largest independent insurance broker and employee benefits consultant. "Without quality and outcome measures, businesses and employees alike lose the opportunity to contribute to a more rational healthcare system."

Some health care quality experts say the delay makes sense. "For all that is written about ACOs, we are VERY early in our journey," says James Conway, a lecturer at the Harvard School of Public Health. "The last thing we want to do is create a new “gotcha” for the pioneers or introduce new financial risks based on poor or flawed methodologies."

The five Boston Pioneers say they expect to stay in this program that will inform, if not create, the framework for a new way to manage care, both in Massachusetts and across the country.

"While we have concerns over the proposed benchmarks for performance year 2013, Steward Health Care remains committed to working with the Center for Medicare & Medicaid Innovation towards our collective goal to enhance quality and lower costs for Medicare beneficiaries," says Steward spokesman Chris Murphy.

But providers aren't willing to lose much, if any money, in this experiment, and that's where it gets messy. Will Medicare adjust the quality rules to keep everyone in the program?

"None of the groups want to go out of business because they're tanking in one health insurance plan," says Barbara Spivak, president of the Mount Auburn Cambridge Independent Practice Assocation. But "our goal is to try to make this a workable product. Most of us went into this, not because we thought we’d make tons of money, but because we think managing care provides better care for our patients. And as a consequence, we think we can keep health care costs down."

This program aired on March 8, 2013. The audio for this program is not available.