A Moral Conundrum in Massachusetts Health Reform

The Massachusetts legislature is beginning to deliberate about the Special Commission on the Health Care Payment System's recommendation that the state phase out fee-for-service payment and replace it with global payments to "Accountable Care Organizations" (ACOs). At a conference this past Friday, Representative Harriet Stanley, Chair of the Massachusetts House Committee on Health Care Financing, told the audience that “cost containment is absolutely essential,” that she and other legislators want to see short term (1-2 years) cost savings, and that legislative action is likely before next summer.

Most reports sit on the shelf until they die of old age. That's not likely to happen with the report from the Special Commission. It, and the state, deserve, and will probably get, a lot of attention, as Massachusetts locks horns with the problem of costs! Massachusetts health reform will continue to be an important laboratory for federal policy developments.

Here's the moral conundrum the state will have to grapple with:

1. ACOs (combinations of hospital(s), groups of physicians, and other providers) will be responsible for caring for a population within a budget. To do this, and to promote integrated care, they will want to provide maximum care from within the ACO's own network.
   
   


2. But the Special Commission wasn't naive - it understood that in the era of capitation, consumers demanded free choice and rebelled against staying within networks. Here's what the report says - "While payments to ACOs will follow the enrollee’s choice of a primary care physician, patients will not be restricted (unless as a condition of their insurance contract) to providers in their primary care physician’s ACO" (p 57).
   
   


3. #1 and #2 point in opposite directions - #1 implies physician-guided treatment within the ACO while #2 implies patient-guided treatment within the entire community of clinicians (not necessarily restricted to Massachusetts).
   
   


4. I've had an opportunity to pose this conundrum to a member of the state legislature. The legislator gave a two part answer. Here's Part I of the answer - "If a patient wants a 'branded' service and equally good alternatives are available within the ACO, it's OK to be kept within the ACO. But if patients can't get the services they need within the ACO, that's a different story."
   
   


5. If our measurement of quality was precise enough and showed that surgeon A/hospital B (within the ACO) got results that were just as good as surgeon C/hospital D (outside the ACO), this principle would work well. It would be clear that the patient's wish reflected "preference," not "need." Saying "no" could readily be justified as a fair, evidence-based decision.
   
   


6. Unfortunately, we almost never have this information! I asked the legislator what happens then. Part II of the answer was - "we're thinking about this all the time - my staff would be interested in talking about it with you..."
   
   
7. I was glad to hear that the legislature is fretting over the question of how to adjudicate among the values of choice ("liberty"), efficiency, and integration of care (quality). Better information will make the tension among these values easier to address, but I don't see any way of avoiding some tough choices.

If Massachusetts is going to get a grip on its very high medical cost structure the state - probably starting with the Governor - will have to address the conundrum of "choice versus efficiency." We'll try to wiggle out of confronting the conflict between core values, but I don't think we'll be able to. This will be a real test of leadership!