NU Online News Service, June 15, 2:47 p.m.EDT

One aspect of healthcare reform promotes the formation ofprovider organizations aimed at improving the quality of care andcost, but medical-malpractice insurers worry it could have anegative impact on their business, a recent broker’s reportsuggests.

In a recent examination of the healthcare market, Kansas City,Mo.-based insurance broker Lockton reviewed how, under the PatientProtection and Affordable Care Act, healthcare providers canpromote better care and service.

The report notes that the Medicare Shared SavingsProgram promotes the formation and operation of accountable careorganizations (ACOs) aimed at serving Medicare fee-for-servicesbeneficiaries.

An ACO is an organization of healthcare providers that agrees tobe “accountable for the quality, cost and overall care of Medicarebeneficiaries who are assigned to it.”

Among medical-malpractice insurers’ concerns cited byLockton:

• Will widespread consolidation of providers and theirrisk-financing programs result in malpractice insurers gettingsqueezed out of the market?
• Will it promote the formation of captives and otheralternative-financing vehicles?
• Will plaintiff attorneys aim more aggressively at an ACOhospital-sponsored program under the assumption that there arehigher limits than with a solo or small group practice?
• Will underwriters have clearly defined provider relationshipsor will there be gray lines?
• With the move to a quality-based payment system requiringevidence-based care, will the industry move to national standardsof care instead of community standards? Will this impact the tortsystem?

The report says management-liability underwriters and brokershave expressed concern that forming ACOs could raise regulatoryconcerns. A number of federal agencies, including the Department ofHealth and Human Services, have released new rules and guidancedocuments aimed at alleviating “management liability concerns.”