8 Ways That ACOs Can Increase Your Malpractice Risk

Brian S. Kern, Esq.


September 09, 2011

In This Article

More Areas of Concern

7. Integration Challenges

The proposed ACO regulations heavily emphasize integration through technology. Participants are expected to not only meaningfully use electronic medical records, but to also effectively coordinate care among all providers.

At once, the shared savings model also discourages physicians to repeat tests on patients, which would drive up the cost of care. Therefore, specialists who are accustomed to performing all of their own testing and diagnostics from scratch will be expected to rely at least to some degree on tests already performed. This runs the risk of prejudicing treatment based on initial evaluations at the peril of the patient. Discouraging extensive testing may prevent unnecessary expense but may also prevent necessary treatment.

Because ACOs will be held to a high standard in terms of integration, the lines of responsibility may also get blurred. Primary care physicians should not have complete responsibility to oversee treatment for all ACO beneficiaries, but the ACOs themselves apparently do. Consequently, liability for any system breakdown -- even if it occurs at a third-party level (such as labs or pharmacies) -- may fall back on to the ACO. Determining who to blame and, more importantly, whose insurance policy will be assessed, will be an ongoing challenge.

8. Insurance Challenges

Though not specifically mandated, the Patient Protection and Affordable Care Act has caused an exacerbation of consolidation within the healthcare delivery system. As groups integrate, physicians may get assurance from their employers that their liability insurance is going to be handled for them. Unfortunately, history has demonstrated that many groups and systems view professional liability as a potential profit center, even if it puts individuals at risk.

Many healthcare systems elect to self-insure or form other alternative risk models, which only protect physicians as long as the system remains financially stable. ACOs are accepting large amounts of risk from investments in real estate, infrastructure, and acquiring new practices, to penalties resulting from "overbilling" Medicare for its insureds. Taking additional risk on self-insuring professional liability may not be prudent until the systems can prove their ability to flourish under the new payment models, if at all.

Perhaps of greater concern is that many alternative risk models do not participate with government "guaranty" funds, which provide protection when traditional insurance companies become insolvent. If a self-insured program fails, all physicians can become personally liable for claims.


Comments on Medscape are moderated and should be professional in tone and on topic. You must declare any conflicts of interest related to your comments and responses. Please see our Commenting Guide for further information. We reserve the right to remove posts at our sole discretion.