Guest Post: Accountable Care and the Power of Partnerships

Thursday, March 7th, 2013
This post was written by Ally C. Evans

Ally C. Evans

Ally C. Evans is an industrial engineer specializing in process and system improvement in healthcare.

In the first of a three-part series on “Accountable Care: The Power of Partnerships,” guest blogger Ally C. Evans, healthcare consultant with Freed Associates, outlines the platform and root causes of the current conundrum: despite having the most costly health system in the world, the United States consistently underperforms on most dimensions of performance relative to other countries.

The Burning Platform

“Despite having the most costly health system in the world, the United States consistently underperforms on most dimensions of performance, relative to other countries.”(The Commonwealth Fund) 1

Many tout the American health system as being the “greatest in the world,” yet an ever-present barrage of evidence tells a very different tale. The health of those who live in America is deteriorating. Patients in the United States are experiencing more complex and costly health conditions than ever before. In 2005, 133 million Americans were living with at least one chronic condition. In 2020, this number is expected to reach 157 million.2To make matters worse, a growing proportion of this population have multiple chronic conditions and many do not receive the care they require to efficiently and safely manage their health.

According to the 2009-2010 National Health Interview Survey, 21 percent of adults ages 45-64 had multiple, self-reported chronic conditions between 2009-2010, a 4.9 percent increase from 1999-2000.3 Of this population, almost one-quarter delayed or did not receive necessary medical care, and 22 percent did not fill prescriptions due to cost.3 The implications of these trends are significant, and result in a vicious cycle: The high cost of care leads to care-avoidance, which exacerbates the condition and ultimately results in even higher costs of care to treat the higher-acuity condition.

National health expenditures in the United States are forecasted to reach $4.6 trillion by 2020, a massive 19.8 percent of GDP. 4. Fifty percent of this will be government-sponsored spending through Medicare, Medicaid, and the new health insurance exchanges, part of the Affordable Care Act coverage expansion. Chronic illness consumes a vast proportion of these healthcare costs, and is predicted to reach a $4.2 trillion spend by 2023.5. To put these numbers in perspective, the United States has the highest per capita and total healthcare spend of any country in the world, while simultaneously scoring among the lowest countries on key health indicators such as life expectancy (as shown in the accompanying figure), infant mortality, obesity, death from asthma and amputations due to diabetes.6

The Root Cause

We are not facing a new problem. Rising costs have been an economic concern for decades, culminating in various rounds of healthcare reform and ‘crisis mode’ change initiatives. Numerous factors have influenced this cost conundrum; two of the most significant drivers are the fee-for-service (FFS) payment model and the fragmented design of care delivery.

The FFS model boils down to a simple equation: More services = more money. There is limited accounting for quality, service or outcomes. It is a pure “keep ‘em sick, keep ‘em coming” volume model that offers incentives to providers based on the services they bill for, not for the quality or outcomes of those services. This is analogous to paying factory workers for each unit they produce, regardless of the quality. The big difference here is that we’re not dealing with products; we’re dealing with lives. The challenge now lies in modifying practices and cultures in order to move away from the high-utilization and over-ordering that has resulted from the FFS model.

Fragmented systems of care are another immense contributor to the current cost position of healthcare. Provider ‘silos’ generate substantial overuse of services due to ineffective or non-existent systems of communication. The same patient may receive the same tests from two or three different providers simply because providers don’t talk, systems don’t talk and each provider is incentivized to deliver those services. Not only is this a huge waste of resources, but this approach also fails the patient.


  1. Davis, K., Schoen, C., Stremikis, K. Mirror, Mirror on the Wall: How the Performance of the U.S. Health Care System Compares Internationally, 2010 Update. The Commonwealth Fund. June 23, 2010. Available Online
  2. Wu, S.Y. and Green, A. Projection of Chronic Illness Prevalence and Cost Inflation. Santa Monica, Calif.: RAND, October 2000.
  3. Freid VM, Bernstein AB, Bush MA. Multiple chronic conditions among adults aged 45 and over: Trends over the past 10 years. NCHS data brief, no 100. Hyattsville, MD: National Center for Health Statistics. 2012.
  4. Centers for Medicare and Medicaid Services, Office of the Actuary. National Health Expenditure Predictions 2010-2020. July 2011. Available Online
  5. DeVol, R., and Bedroussian, A. An unhealthy America: The economic burden of chronic disease. 2007. Santa Monica, CA: Milken Institute.

(Editor’s Note: In subsequent posts, Ms. Evans will discuss the volume to value paradigm shift, and then introduce ACOs as a panacea.)

Ally C. Evans is an industrial engineer specializing in process and system improvement in healthcare. Most recently, she has driven various initiatives in the accountable care arena, focusing on the design and implementation of ACO strategy and tactical interventions. She is a consultant with Freed Associates, a California-based healthcare consulting firm. Their work is to provide sustainable solutions that enable healthcare organizations to improve patient care services, reduce costs and increase operational efficiency.

HIN Disclaimer: The opinions, representations and statements made within this guest article are those of the author and not of the Healthcare Intelligence Network as a whole. Any copyright remains with the author and any liability with regard to infringement of intellectual property rights remain with them. The company accepts no liability for any errors, omissions or representations.


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