One of the big reasons Accountable Care Organizations have been mostly disappointing is that the regulators caved to the hospitals in the writing of the Obamacare law. The regulators assumed that hospitals could wring efficiencies out of the healthcare system. Integration of hospitals and physicians was assumed to be good.
A new study in Health Affairs sheds light on why this is not the case. Researchers used hospital data from Truven analytics to examine trends in hospital costs for the privately insured as a function of hospital and physician integration. They found that claims from more integrated arrangements had higher overall hospital costs with only a tiny decrease in hospital admissions.
A missing piece from this analysis is physician costs, which climb as hospitals buy out physician practices.
Hospitals simply can’t be trusted to be leaders in lowering healthcare costs.