A Lesson from the Sneetches0

This Practitioner Application to the article “Post Acute Care and Vertical Integration After the Patient Protection and Affordable Care Act” (by Patrick D. Shay and Stephen S. Mick) appeared in the January/February Edition (Volume 58, No. 1) of the Journal of Healthcare Management.

In his classic tale “The Sneetches,” Theodor Seuss Geisel (Dr. Seuss, 1961) created a society divided by entitlement in which the lines of separation were removed, thrusting its members together. A satire about discrimination, “The Sneetches” offers children an early introduction to the arbitrary walls that those forces governing society can build and destroy at their whim.

Shay and Mick may be said to describe a similar scenario as they apply provisions of the 2010 Affordable Care Act (ACA ) to post-acute care and vertical integration under the Medicare Shared Savings Program (also known as accountable care organizations or ACOs) and to bundled payment systems. They note that these are the areas in which the influences of the ACA are most apparent. In the process, Shay and Mick remind us that perception is formed largely on the basis of factors lurking beneath the surface that care little for public opinion. For example, much like Dr. Seuss’s Sneetches, Hurricane Sandy, which struck the East Coast shoreline in October 2012, rendered the “haves” and “have nots” almost indistinguishable. Bellevue Hospital, the oldest hospital operating in the United States, was capable of offering roughly as much care during and immediately following the hurricane as it was in 1736, when the New York City Almshouse designated six bedrooms as Bellevue’s first “ward.”

During my 9-year tenure as CEO of a community hospital in Los Angeles County, California, bundling was still considered a pejorative term and vertical integration was lost somewhere in the abyss between Stark I and Stark III. As ours was a small hospital with a busy emergency department and no managed care contracts, patients usually left soon after stabilization, either own their own two feet or when transferred by the payer to a contracting facility. Vertical integration had little impact on my day-to-day operations. I cannot say how I would have reacted to AC Os or even this article then—at least until I took the time to review the application to become an ACO (see below).

In today’s healthcare climate, however, I hold hope that patients will come to expect a full continuum of services for an entire care episode in a single institution or ACO. While most acute care facilities now focus attention on the Hospital Value-Based Purchasing program in an attempt to reduce the number of readmissions and unexpected outcomes, the final narrative question contained in the ACO application remains too important to be ignored by anyone in the healthcare sector:

Submit a narrative describing how the ACO defines, establishes, implements, evaluates, and periodically updates its care coordination processes. Also describe: a. The ACO’s methods and processes to coordinate care throughout an episode of care and during care transitions, such as discharge from a hospital or transfer of care from a primary care physician to a specialist (both inside and outside the ACO) . . .

Absent from this final section is any hint of concern about the dangers resulting from vertical integration, not to mention the economic and sociological directions an organization may be forced to follow as it integrates. While the authors raise pertinent questions relating to the future of modern American healthcare, the answers they seek may not be available until the ACA has had time to mature and align itself with the unspoken demands of the industry.


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