Pay Versus Pain: How the Affordable Care Act Affects Hospital Funding

After many years of controversy and compromises, the Affordable Care Act (ACA)—also known as "ObamaCare"—is now in full swing, and people are starting to see how the policy changes associated with the bill are affecting both patients and healthcare providers. The media has given plenty of attention to the political and financial sides of the ACA, but many have overlooked some of the less obvious impacts. For example, one of the biggest concerns for healthcare administrators today is not just the amount of funding they receive, but also the ways they must adapt to new measures of quality and performance.

On the surface, linking hospital funding to some evaluation of quality is a no-brainer. There are already groups, including the Joint Commission and the Centers for Medicare and Medicaid Services, which use quantitative metrics to assess compliance with national safety and quality guidelines. But now, instead of mere compliance and ratings, the ACA has begun to associate funding with performance, rewarding "good" hospitals and punishing less successful ones. This feature extends to the provider level; doctors whose patients get better receive better pay.

Misgivings about this policy chiefly concern implementation: what sorts of metrics does the ACA use to evaluate doctors? Does this system actually succeed in improving national health? Is this manner of assessment sustainable? Currently, officials evaluate healthcare facilities and practitioners according to a combination of clinical outcomes and patient satisfaction surveys.

Unfortunately, these measures have already proven problematic. First of all, the implementation of the ACA has launched an influx of formerly uninsured patients into the medical system – much as the bill intended. But many of these patients are receiving care for the first time in years. With so many new, sick patients, it has been difficult for doctors to prove that they are actually improving "clinical outcomes." This problem is especially prevalent in the poorer areas that need funding the most.

Secondly, relying on "patient satisfaction" as a measure of quality care may encourage hospitals to focus on pleasing patients rather than healing them. In addition, factors like patient compliance and satisfaction are largely outside of doctors' control; as the saying goes, you can bring a horse to water, but you can't make him swallow the pill. Yet these factors now play a deciding role in whether a single doctor, nurse, or an entire hospital gets paid at the end of the day.

In order for this new system to work, it will require a fundamental change in the doctor-patient relationship. And maybe that's a good thing. On the one hand, it may encourage doctors to actually listen to their patients and give them a thorough evaluation, rather than rushing through a 15-minute appointment in an attempt to see as many people as possible. At the same time, it may also encourage healthcare practitioners to be more selective in whom they see. Many doctors have already begun "firing" patients who refuse to vaccinate their children. If a doctor's pay were strictly linked to the quality of their patients' health, we might also see them threaten to drop patients who refuse to address other medical issues, from smoking to obesity to addiction. Of course, we can't be sure that such negative consequences would actually motivate Americans to improve their health in the long term, but it might be worth it to try something new.

Officials have projected that the ACA will begin paying for itself by 2021. What many don't realize is that this outcome is dependent on much more than flat insurance costs and service charges. Nuanced issues concerning provider pay, hospital funding, and patient motivation could ultimately make the difference in whether this bill sinks in a pool of debt and criticism or floats on a cloud of savings and health.

USA Today: ObamaCare Takes Root in Appalachia
USA Today: Hospitals Face Whole New World Under New Healthcare Law
The Heritage Foundation
The Atlantic: The Problem with Satisfied Patients Some Doctors Firing Patients

About the Author:
Iris Stone is a freelance writer, editor, and business owner who has written on a range of topics. She has experience covering content on medicine, healthcare, and career training, as well as education. Iris is also interested in science and mathematics and is currently studying to be a physicist. Check out her Google+ Profile.

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