Can Accountable Care Organizations Save the Commons?

By Michael R. Weitekamp, MD

The now-famous essay by Garrett Hardin, The Tragedy of the Commons, first appeared in Science, in 1968.  The premise of his article might be familiar to you, but if not, it is worth a quick read. He made the intellectual argument that population control has no technical solution. Hardin’s illustrative tale — borrowed from and credited to William Forster Lloyd (1794-1852) — concerns the “tragedy” wherein the rational self-interest of each individual herdsman leads inexorably to the depletion of public grazing areas, “the Commons.” Hardin’s use of the word “tragedy” was in the classical dramatic sense — not necessarily denoting “unhappiness” but rather “the solemnity of the remorseless working of things” — what I might less artfully describe as watching a train wreck in slow motion, powerless to intercede.

The concept predates Hardin and Lloyd.  Aristotle knew “that which is common to the greatest number has the least care bestowed upon it.” I would not be the first to attempt to link the parable to health care. Hardin also revisited the concept 25 years later as applicable to any number of societal resource challenges. Health care as a limited societal resource may arguably be viewed as a “Commons.” Finite resources and infinite need create a recipe for tragedy.

So can Accountable Care Organizations (ACOs) as envisioned in the Affordable Care Act of 2010 provide a technical solution to a tragedy of the health care commons? As is so often the case with complex issues, it depends. The health care commons has many “herdsmen”: patients, physicians, other health professionals, health insurance and health system executives, pharmaceutical and device manufacturers, to name a few. (I know some of you will want to include malpractice plaintiff attorneys in this story, but my New Year’s resolution is to not blame them for everything, so please humor me this once). If each “herdsman” acts in his or her own rational self-interest … how might I put this delicately? We’re screwed.

Skeptics need not look far to find potential flaws in the transformative promise of ACOs. Dispassionate review of the Physician Group Practice Demonstration, a pilot that informed the ACO movement, found near uniform improvement on quality process metrics, but a meager $210 per Medicare beneficiary cost reduction over five years. The current trends of consolidation of hospitals and the mass employment of physicians are seen as strategic positioning to become a competitive ACO.

But what if this all turns out to be wolves in sheep’s clothing — back to the pasture with the end result that consolidation and the attendant negotiating leverage drives private payment for healthcare even higher? Remember, exhibiting rational self-interest is not tantamount to being a Gordon Gekko.  Current fee-for-service incentives in the health care market drive a business model where you do more to get more. Insurance that isolates patients from the true cost of their choices drives rational decisions to consume more. Imploring individual “herdsmen” to do less today, with a promise of potential shared saving and a saved Commons down the road, is problematic. As Upton Sinclair so elegantly said, “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”

So, can ACOs save the Commons? It depends on whether they can accomplish the following:

  • Gain consensus among communities, employers, patients, all insurers, and providers that the determinants of health have less to do with what we spend on medical services and more to do with education, economic stability, health literacy, prevention, and wellness
  • Build a business model that moves progressively and rapidly away from fee-for-volume to one that rewards proper management of the 10 percent of patients who account for nearly 70 percent of cost, and at the same time rewards patient and community engagement in holistic wellness
  • Incent all “herdsmen” so that rational self-interest is aligned with protection of the Commons.

In December 2011, CMS announced the 32 organizations selected through a competitive process to be Pioneer ACOs. Twelve are members of the AAMC. Each will have an opportunity to leverage missions of education, research, and patient care as they begin this journey. They understand the challenge before them and they understand the danger to the Commons if they do not succeed. We should all be cheering them on!

Michael Weitekamp, MD, MHA, FACP is a Professor of Medicine at Penn State College 0f Medicine and a Robert G. Petersdorf Scholar at the Association of American Medical Colleges. He can be reached at mweitekamp@aamc.org.

 

0 thoughts on “Can Accountable Care Organizations Save the Commons?

  1. In general, I agree with what you say, but I’m interested in hearing more about the first bullet. Does this imply that the health care system should step back from health and focus on treating illness? Who should take responsiblity for shaping policies of education, economic stability, health literacy, prevention, and wellness so that they reduce illness and health care expenditures? The basic challenge of our diffuse health care system is that the impact of these current policies on health care spending are not recognized as coming out of all of our wallets and therefore are invisible.

    1. Thanks for your comments. First bullet actually speaks to crafting a better balance between “treating illness” and addressing the more powerful socioeconomic and behavioral aspects of “wellness.” You are right about much of this being “invisible” – my contention is that health care providers will need to be much more proactive with payors, governments, self-insured employers, and the general public to move away from a focus only on “illness” and toward a more holistic and ultimately sustainable model.

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