Patients' role in accountable care organizations.

I ever there were a crisis mo­ ment that crystallized the need for reforming the U.S. health care delivery system, this is it. The 2010 Affordable Care Act (ACA) promises to expand health insur­ ance coverage, a key first step toward improving health equity. But newly insured Americans will gain access to a strained, frag­ mented system that often fails to deliver effective, efficient care. Meanwhile, the burden of chronic disease, coupled with incentives that reward providers when pre­ ventable complications occur, con­ tinue to drive up health care spending. To address these escalating problems of quality and afford­ ability, many analysts and policy­ makers support the development of accountable care organizations (ACOs). ACOs could take various forms, but they have generally been conceived of as groups of primary care physicians, special­ ists, and sometimes hospitals, joined together in either verti­ cally integrated systems or net­ works that are accountable for improving the quality and afford­ ability of care for a defined pa­ tient population and that are eli­ gible for financial bonuses if performance goals are met. The ACA takes a first step in this di­ rection by allowing Medicare to contract with ACOs; interest in this concept is also growing among commercial payers, Med­ icaid agencies, and several state legislatures (e.g., Colorado, Ver­ mont, and Washington). Understandably, much of the debate about ACOs has focused on structuring provider networks, reimbursing providers, and de­ signing performance­based re­ wards and penalties for provid­ ers. Largely missing from these discussions is a role for patients. In many ACO­like models, includ­ ing Medicare’s Physician Group Practice Demonstration project, patients who receive the majority of their care from participating providers have been assigned to an ACO through “invisible enroll­ ment,” with no prospective noti­ fication and sometimes no aware­ ness by the patients that they’re associated with an ACO. But a provider­based accountability model that is disconnected from the way patients seek care not only may fail to achieve its cost­ saving and quality goals, but may also give rise to a backlash among patients and providers. Except in cases of closed, integrated deliv­ ery systems (such as Kaiser Per­ manente or certain large provider organizations with capitated pay­ ments), in which consumers choose to use an ACO through their choice of insurance, most patients are not obligated to ob­ tain care only from a particular provider group. Studies of the care patterns of Medicare beneficiaries, which helped to launch the ACO move­ ment, offer some evidence that patients tend to stick to a given provider group: 73% of benefi­ ciaries’ visits for evaluation and management services (inpatient and outpatient) took place with­ in a primary hospital or involved its extended multispecialty med­ ical staff (an ACO­like grouping), and, on average, 64% of admis­ sions were to the primary hospi­ tal.1 Yet one quarter of evalua­ tion and management visits and more than one third of hospital admissions involved outside pro­ viders. The fact that the ACO has imperfect control over an appre­ ciable amount of the care pro­ vided suggests that increasing pa­ tients’ adherence to an ACO could improve efficiency and savings. There has been little discus­ sion about binding patients to ACOs, however, largely because the freedom to choose one’s pro­ viders is highly valued in U.S. health policy. The managed care backlash and the rise of pre­ ferred provider organizations in the late 1990s have been partial­ ly attributed to patients’ unwill­ ingness to accept closed physi­ cian networks. Most Medicare beneficiaries have not enrolled in private plans that restrict pa­ tients’ choice of physicians, even though these plans offer more generous benefits than does the fee­for­service Medicare program. These consumer preferences sug­ gest that policymakers should focus on creating incentives to build patients’ loyalty to an ACO (see table). One way to do so is to allow patients to share in their ACO’s cost savings — for example, through a tiered provider net­ work, which allows patients to pay less at the point of care depending on their choice of pro­ vider. Under such an arrange­ ment, physicians would be sort­ ed into tiers according to their ACO affiliation, and patients would pay lower copayments for visits to physicians within their ACO. Not only might this ap­