By Lori Inglis Hall @LoriInglisHall

Accountable Care Organisations (ACOs – sometimes confusingly referred to in NHS literature as Accountable Care Systems, or ACSs) are the latest example of the Government’s long-held plans to creep the NHS towards an American system of private healthcare, by carving up public healthcare systems and handing them over to the private sector. Here, Real Media examines the reality behind the latest Health-based acronym and what it means for the already beleaguered NHS.

What is an Accountable Care Organisation?

The answer to this, unsurprisingly, lies in the United States. ACOs are a product of Obamacare, built upon long-standing integrated systems within the private health insurance sector. ACOs take a variety of forms, but are essentially an umbrella organisation of integrated services (acute and primary care, mental health services, social care, and so on). The ACO is given a population-based budget by a funder (likely an Insurance company), with which they are required to achieve specific health-based outcomes (such as patient experience and preventative care), with partners able to retain any savings they achieve. As ever, with any American healthcare system, profit is used as a key incentive. Proponents of ACOs believe this is imperative to ACOs workability; the targeted population will receive better care because this will lead to a healthier population, which will result in a decrease in the overall use of services; voila, savings. Secondly, more effective primary care will mean less strain on hospitals, which will again achieve savings overall.

Accountable Care Organisations and the NHS

The Conservatives have been keen on ACOs since its inception in the U.S under the Affordable Care Act 2010. The system was initially deemed unworkable in the unwieldy NHS, that was, until Simon Stevens took the helm at NHS England in 2014. Stevens is a veteran of scandal-hit U.S healthcare giant United Health, and a well-known champion of the private healthcare sector. Stevens is the brains behind Sustainability and transformation plans (STPs), which are five-year plans detailing the future of local healthcare. Each STP covers on average a local population of 1.2million people. STPs have faced widespread criticism – from a lack of transparency and accountability (try submitting an FOI request regarding an STP. You can’t – they aren’t statutory bodies. There are no minutes of meetings – nothing), to claims that STPs are a way of enacting devastating cuts to the NHS on the quiet.

Above: In a recent interview with Maurice Frankel, Centre for Freedom of Information (CFOI), he explained the government was moving to set up a new secretive NHS body regarding patient safety, not accountable to FOI. Watch in full here:

For Stevens’ NHS England, ACOs are the next logical step. NHS England are big on integration, so in many ways ACOs are a good fit for an organisation which is under constant pressure to keep services running with less and less financial support from central government.

The King’s Fund states that ACOs in the NHS will be comprised of three elements.

  1.       A network of providers tasked with meeting the needs of a defined population
  2.       A budget allocated to those providers by an alliance of commissioners
  3.       A contract which details specific healthcare outcomes and objectives to be achieved within the allocated budget and delivered over several years

It is ambitious. Historically, the NHS does not do integration well. In Northumbria, the partners in the ACO include the Foundation Trust, the Clinical Commissioning Group, the Ambulance Service, Mental Health Services, GPs, and local patients themselves, serving a (largely rural) population of 320,000 people. The idea, say NHS England, is to provide ‘seamless care’ as close to home as possible by developing understanding of the local population and tailoring services to meet those needs. Plans include home visits from pharmacists, an increase in same day advice from GPs to reduce the demand on out-of-hours services, and a reduction in hospital visits.  

Are ACOs a good idea?

It’s hardly a secret that the NHS is in a dreadful state. ACOs work on incentives, with emphasis placed on preventative measures through primary care to reduce the demand on hospitals and other acute services. In other words, more use of GPs and care at home, so fewer people require more expensive hospital care. But, GP figures are falling, more nurses and midwives are leaving the profession than are joining it, and pharmacy funding is being slashed – so who is going to provide these frontline services?

NHS England believes ACOs incentivise efficiency, but the risk in linking incentive to profit – i.e. the ACO can retain any surplus budget once their contract is up – is that the real incentive is to restrict treatment and maximise profit. And, of course, when tendering for services, the ACO is incentivised to plump for the cheapest bid, rather than the best service for patients. In 2016, private sector companies were invited to bid for 14% more NHS contracts than the previous year. This is likely to rise further under ACOs.

There is also very little hard data to suggest ACOs work at all – this is because the system is relatively new in the U.S. Whilst many ACOs have recorded lower hospital admissions in their locality, just under half had gone over budget and made a loss. In other words, NHS England are introducing a relatively untested and highly complex system into the famously inflexible NHS, at a time when the service is already suffering extraordinary stress. And it is a big risk. A budget covering an area’s health and social care provision over several years could amount to billions of pounds – handed over to organisations with little experience in managing such levels of funding.

ACOs illustrate another example of the Government and the NHS attempting to deliver critical services through reorganisation rather than funding. By forcing profit into the heart of the NHS, the government takes one more step away from a health service which is free at the point of need. When the incentive is profit, universal healthcare is rarely the answer.

The government is facing a judicial review over its use of ACOs. Doctors are crowdfunding here: