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Delta Connect Blog

Should ACOs be regulated more like insurance companies?

Posted by Crystal Parks on Aug 12, 2013 8:52:00 AM


Will accountable care organizations (ACOs), incentivized under the Affordable Care Act to better coordinate care, improve quality and lower costs, wind up strangling competition among insurers and providers and actually increasing prices for consumers? 

That is the question pondered by a group of lawyers and economists, some with ties with the America’s Health Insurance Plan Foundation (AHIP), in a new Health Affairs paperreports ModernHealthcare.com. 

As accountable care attempts to join the finances and operations of hospitals, doctors and other providers in order to coordinate care, reduce waste, improve quality and hopefully reduce costs, some regulators are worried this close cooperation among independent provider groups will give them an unfair market advantage, the report says. 

The ACA spells out and antitrust regulators like the Federal Trade Commission have said integrated clinical efforts can work as long as they provide a benefit to consumers by lowering costs and improving care and don’t have too large a piece of local market share, the report notes. 

However, the Health Affairs paper authors argue more needs to be done, like adopting more broadly legislation passed in California that prohibits contract language limiting release of private or quality information to consumers, the report says. Another “regulatory neutral” policy would more clearly define when ACOs meet the threshold for oversight by state insurance regulators that would include solvency requirements already mandated for insurers.

Indeed, AHIP has already argued that that ACOs should be subject to insurance regulations in instances where they carry financial risks like those of insurers, otherwise consumers could pay if an ACO began to lose its financial footing, the report says.

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Topics: Affordable Care Act, Accountable Care Organization, Pioneer ACO


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