Changes in the final rule for accountable care organizations will improve the chances of getting physicians to participate; but it is not clear physicians are going to flock to ACOs right away.

We are pleased that the government listened to the concerns that were raised about the initial ACO plan. One improvement in the rule was the decision to allow specialists in some cases to act as the primary provider. For example, under the new plan, a patient with advanced heart failure, arrhythmias, congenital heart disease or another unstable cardiac condition that requires management by a cardiologist would not have to get a referral from a primary care physician to see the cardiologist. The specialist could act as the primary care provider while continuing to manage the serious heart condition. This is a sensible approach for the minority of heart patients who need this.

The main ACO acceptability problem is there’s so much uncertainty in the system—especially with the looming threat of 29 percent cuts to physician payments through the flawed formula used to calculate Medicare payments to doctors. The American College of Cardiology has long advocated for a new payment model for health care. We need a system that rewards quality care and better patient outcomes instead of quantity. Medicare has made moves toward rewarding quality, but it’s not enough.

The tools are currently available to support a quality-oriented system in the form of registries established by the ACC and other medical societies. Full clinical registries like the ACC’s National Cardiovascular Data Registry and the PINNACLE outpatient quality program are rich sources of data related to performance measures that give providers and payers the information they need to focus on value—or better outcomes at affordable costs.

Registries attached to EHRs allow physicians to track what’s going on with their patients; they provide an early detection system for problems; and they could provide Medicare with the information needed to create a quality-oriented payment system. Medicare’s database is a claims-based system and does not include the clinical data and guideline-oriented feedback found in medical society registries. Tracking care through clinical registries improves outcomes, reduces readmissions, and helps physicians and patients choose the most appropriate tests to achieve significant savings.

Jack Lewin, MD
American College of Cardiology CEO

Last Thursday, the Institute of Medicine finally released its long-awaited set of recommendations for how the Secretary of Health and Human Services should accomplish the impossible -- determining the "essential health benefits" for tens of millions of Americans under the to-be-implemented Affordable Care Act. Early reviews indicate that, not surprisingly, there is no way to please everyone, or perhaps even anyone, in this highly political exercise. The countervailing pressures "essentially" are that one side wants to ensure that benefits are more comprehensive and generous to ensure that everyone either gets what they want, or what other interests and experts think they must get anyway. The other side (paying for those essential benefits) worries that setting benefits levels too high will only drive health care costs even higher and make insurance coverage even less affordable and available. This traditional dilemma arises whenever health benefits policy must be determined through the pressure cooker of health care politics and the HHS bureaucracy.

Some quick lessons from the early phase of this fruitless exercise:

- This is the inevitable result of over politicizing the complex personal tradeoffs involved in choosing affordable and necessary health benefits.

- One man's ceiling is another man's floor.

- The IOM expert committee already over 300 pages just to suggest "how" to make these determinations, and it could not even decide on "what" should be included as essential health benefits.

- Even setting the initial level of EHBs at that of the "typical" small employer health plan will subject the latter to future cross pressures that will drive those costs higher over time.

-The government has an inherent conflict of interest when it acts as both the regulator and purchaser (or subsidizer) of health benefits.

- The key issue is "who" decides, rather than "what" the right political decision should be.

- We need to delegate much more of this balancing act to millions of "private and personal" pressure cookers, rather than to a single one sitting on top of the dysfunctoinal stove in Washington.

For decades, health insurance plans have helped individuals, families, and small businesses strike the right balance among affordability, access, and comprehensive coverage. With the Institute of Medicine expected to issue recommendations to HHS this week about which “essential benefits” should be included in health plans that will be offered through new exchanges, this experience holds important lessons for policymakers.

In the commercial marketplace, health plans work with employers and health benefits advisors to determine which benefits or level of benefits will be covered; how much they will contribute to the cost of services; and how they may access medical care through the plan. Through this process, health plans are able to respond and adapt to the varying needs and preferences of employers and consumers. Other programs, such as the Federal Employee Health Benefits Program and the Massachusetts Exchange, rely on this same framework in designing their benefits. Benefit packages are regularly assessed, updated, and refined.

In the Affordable Care Act, Congress identified ten categories of “essential” services or items that should be included in any plan’s benefit package offered through the exchange. These categories were designed to be broad enough to ensure coverage is comprehensive while still giving individuals and small businesses flexibility to choose the type and amount of coverage they can afford to purchase. If the essential benefits package goes beyond Congress’ intent and prescribes rigid elements of the benefit structure, such as number and frequency of services that should be covered, it will be putting at risk affordable coverage for millions of Americans – and breaking one of the central promises of health reform.

It is not possible to give consumers affordable converage with so-called "generous" benefits, at least as these are currently understood in the U.S. context. It should be quite possible, however, to structure an affordable package that provides adequate benefits for the vast majority of Americans.

We know from multiple sources, including the UCLA-RAND appropriateness method, IOM roundtables, comparison with health spending in other high income countries, and even the highest-performing quintile of regions in the U.S. that roughly one third of healthcare spending in the U.S. is ineffective, wasteful or downright harmful. Why subsidize that?

Obviously, any package of essential health benefits package should include services known to be of high value, like childhood immunization and other services found to be effective by the US Preventive Services Task Force. Lifesaving trauma and emergency care should be covered as well.

Services where the evidence is less clear should be the top priorities for comparative effectiveness research.

Clinical services, procedures, drugs and devices that are clearly above the line - and there are plenty of them - should not be part of basic package if the evidence doesn't support this. Individuals should still have access to them if they wish, but only if they pay out-of-pocket or purchase supplemental coverage.

This approach would assure that everyone has access to a decent minimum of care, while allowing market forces to work where the evidence is less clear-cut. This would give drug and device manufacturers and healthcare providers a powerful incentive to prove their value, rather than strong-arming payers to cover every product and service.

In the U.S., almost nobody dies of thirst. That's because tapwater is cheap, clean and thankfully plentiful. Folks can buy bottled water if they want, including several boutique brands. But taxpayers are't required to subsidize their purchases. Healthcare could work the same way.

Art Kellermann, MD, MPH

RAND Health