Some Doctors Question Medicare Program in Health Law

President Obama's health
care overhaul is being hit with a new set of arguments, this time by
doctors who suggest that a little-known Medicare program within the
law creates a potential threat to their autonomy and to patient care.

In an effort to streamline
health care delivery for Medicare patients, the provision calls for
the formation of Accountable Care Organizations (or ACOs), which are
projected to provide high quality care while lowering costs. One of
the leading examples of the ACO model is the
Mayo Clinic. The law seeks to carry the Mayo Clinic
paradigm a step further. Physicians who are able to reduce costs below
a benchmark - to be determined by the
for Medicare and Medicaid Services
the federal agency that administers Medicare and Medicaid - will be
rewarded with a share of the savings. The only hitch: a physician must
have 5,000 Medicare patients.

For doctors who fall below the 5,000 patient mark, they must join an ACO if they wish to partake in the shared savings program. Although participation is voluntary, such an alignment comes with a price. There's a fear among doctors that they could lose some clinical independence. This dovetails into the question of who physicians would be responsible to; patients or corporate-run ACOs. The potential for a drop in quality of care has many doctors worried that the new law, which goes into effect Jan. 1, 2012, will ultimately have the opposite effect of what Congress and the Obama administration intended.

The American Medical
the health care reform bill as it made its way through Congress. However,
that it's law, CMS officials must figure out the intricate workings
of the program. AMA president,
B. Wilson, M.D.
said, "Unless those regulations are done in the right way, this whole
effort to expand accountable care organizations across this country
and improve health care, and to a great extent the outcome of the Affordable
Care Act, will be in severe question."

An AMA position statement recently
sent to the CMS underscores Wilson's concern. The document asserts
that, "ACOs must be operationally structured and governed by an
appropriate number of physicians to ensure that medical decisions are
made by physicians (rather than lay entities) and place patients'
interests first."

Several days later, similar
words of caution were sent from the
Osteopathic Association
Academy of Family Physicians
Academy of Pediatrics
and the
College of Physicians

The principles are a response,
in part, to a growing trend among doctors who decide to give up private
practice in favor of employment with hospitals. Earlier this year the
Medical Group Management
a survey that showed the percentage of hospital-owned practices grew
from 26 percent in 2005 to 55 percent in 2009, more than double in just
four years.

The move away from privately
owned physician businesses is motivated by frustration over mounting
costs and lower reimbursements.

Wilson said he has heard from
physicians with concerns that ACOs will be largely operated by hospitals
that have bought physician practices. "They see that as not necessarily
positive for them. It potentially is detrimental for them, and a loss
of control of the ability to make decisions," he said. "From the
AMA's perspective, we think to have these accountable care organizations
hospital-dominated as the only model would be detrimental. It would
decrease competition and we believe in the end would not be a help as
far as the quality of care."

Hospitals are in a better financial
position to set up an ACO than most small practices, according to
Jeffrey Ruggiero, an attorney with Arnold & Porter
LLP in New York City, who is helping a variety of organizations in various
stages of ACO exploration. "Certainly the small practices, defined
as three to five physicians, are not really in a position to be able
to afford this financially," he said. The exact price to form such
a business depends upon a variety of factors that are specific to each

Jonathan Blum, deputy administrator
of CMS, said, "We hear the concern that hospitals will buyout physician
practices and the notion of a physician working in a small practice
is at risk. We are respectful, we are mindful. One of the things that
we have done in the development of the shared savings program proposed
rule is to request more information from the public on these kinds of

Even Congress is jumping into
the act. Concerned with the question of physician autonomy,
Rep. Steve Israel, D-Huntington, N.Y., has started a
task force to look into the situation. "I intend to talk to them [doctors]
about that to see if we could come to a good solution," he said. "These
are the people that are on the front lines and I want to hear their
views and understand their opinions before making a judgment."

Endeavoring to help physicians
in New York City retain their independence,
Medical Society of the County of Queens
an organization representing the interests of more than 900 physician
members, initiated recent efforts to form its own ACO. In other words,
an ACO created by independent doctors for independent doctors.

Janine Regosin, executive director
of the Queens medical society said, "One of the options where they
can run to safety, where they can get relief from this constant hole
in the money bucket where they're just bleeding revenue, is to work
for a hospital. For some doctors, that's a really good option, but for
some doctors it doesn't do their practices justice. They don't like
it because they lose their autonomy."

Hospital-owned ACOs will create
a situation in which doctors have little or no input in many care decisions,
according to
H. Kaplan, M.D.
a New York City oncologist. "If a hospital runs a physician group,
their interests are in the hospital," he said. "They will use the
doctors in their referrals to build their hospital. Essentially their
role is to serve shareholders, not their doctors." Kaplan is on the
board created by the Queens medical society to form the borough's
ACO. He warned that three city hospitals are in a position to potentially
create ACOs: The
Shore - Long Island Jewish Health System

(an organization of 14 hospitals),
Sinai Medical Center
Langone Medical Center
. Crain's New York
LIJ's intentions in June and reported that
Montefiore Medical
in the Bronx
is also planning to make the transition.

On Nov. 4, the society held
an "Informational Forum" in which local doctors were pitched
a plan to enlist them in the Queens ACO. Kaplan estimates that most
primary doctors in the borough have 1,000 Medicare patients, and that
the planned ACO will need at least 20 physicians to make the endeavor
financially feasible.

"We're fighting for our
lives," said Kaplan. "The problem is we're a small group, and
right now there's no funds or any major support. So here we are, a
group of doctors - which we hope will wind up being a very large group
of doctors - taking on a very large hospital-based organization. And
it is David versus Goliath."

Despite the pushback against
hospital ownership, physicians will likely have the choice to include
hospitals as a component in an ACO. That option is being kept open by
the CMS. Blum said, "We want to make sure that different configurations
are promoted and not just only a hospital-centric model."

Half a country away from Washington's
bureaucracy, Joseph Schlecht, D.O. is launching a physician-led ACO
Yet there's
a twist. In stark contrast to the effort in Queens, Schlecht, a board-certified physician whose family practice is owned by the
St. Francis Health
(which also
operates five hospitals), is working with his employer to create the
ACO. Although the company will be an independent subsidiary of the hospital,
doctors are envisioned as being in charge. "Our organization understands
very well that the physicians will be the ones making the decision on
the care of the patient," said Schlecht." I mean, that's just
100 percent the way it's going to be."

While that may work in Jenks,
Kaplan thinks it's highly unlikely in a large urban center such as Queens
where the closure of several local hospitals has left few options for
doctors. However, he believes ACOs may be able to influence a hospital's
quality of delivered care and the cost of that care.

The overriding concern is whether
the ACO provisions
of the health care reform law will
work at all. That's a big question, especially in light of the fact
that CMS officials are not expected to release proposed regulations
until early 2011. The announcement may include details of how the agency
will calculate Medicare cost benchmarks and physician bonuses.

"ACO's are like unicorns.
Everyone knows what they look like and no one's ever seen one,"
J. Margolis, M.D.
chairman of the board of the
Committee for Quality Assurance
a nonprofit organization known for its voluntary health care accreditation

If the government's ACO model
succeeds, Regosin of the Queens medical society believes it will go
a long way toward fixing the nation's fragmented delivery of medical
treatment. "The way the health care system is right now, it doesn't
lend itself to physicians working together in a very collaborative way,"
she said.

Schlecht also sees the ACO
as an opportunity. "It makes no difference
whether it's Democrat or Republican, we've got the same problem with
health care in this country," he said. "If we want to solve it we
have to work together. 'We' being the physicians, 'we' being
the hospitals, 'we' being the payers. It's past the time for people
to be setting up silos of their own excellence."

A previous version of this article incorrectly omitted information regarding doctors who fall below the 5,000 patient criterion and the voluntary aspect of the Medicare shared savings program.