Survey: Hospitals skeptical of health reform, ACOs

September 17, 2012

Survey taker says payers are the only winners in healthcare reform; calls ACO member rules silly.

More than three-fourths of hospital executives responding to a national survey say healthcare reform will decrease their private payer rates, and more than half have no accountable care organization (ACO) strategy or plans.

“As far as health reform, hospitals are skeptical because it's clear that the only certain winner is the payer,” says Brandon Edwards, president of ReviveHealth, the communication firm that conducted the National Payor Survey. “Hospitals are getting hammered with cost pressures, declining volumes, rate pressures, and tighter credit markets. They are fixed asset executives living in a world that’s becoming service economy based. The real problem is that payers are enjoying record profits, with a shrinking base of commercial lives, and the providers are struggling. Health reform is just an added layer of complexity, difficulty, and uncertainty on top of a tough economy and an even tougher operating environment.”

He also cites “the complexity of the arrangements required, the costs, and the silly and counterintuitive rules for assigning and managing members” as reasons why more providers aren’t planning to adopt ACOs.

The survey, which also asks respondents to rank health plans according to a number of factors, ranked WellPoint the worst overall, and BlueCross plans the worst on payment rates for healthcare delivered.

Edwards has some advice for payers.

“First, stop playing games - direct network staff to tell their providers the truth, deal with them honestly, and address issues promptly when they arise. Honesty and transparency goes a long way, even when the payer is telling the provider something they don’t want to hear. Second, payers can look for ways to truly partner with providers. That means being at risk and sharing rewards fairly, rather than shifting risk to members and providers and guaranteeing their own margin before putting anything at risk. There are many other things, but this would be a pretty good start.”

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