Accountability has been a big deal lately in health care, and a huge disruptor of the traditional way things have been done.
Medicare has been using Accountable Care Organizations (ACOs) to try and find ways to reduce health care spending growth. And accountable care has spread to the private sphere as well, with big insurers like Aetna (NYSE:AET) and WellPoint (NYSE:ANTM) signing value-based contracts and implementing new ideas in health care.
But why is accountable care so attractive?
Simply, because the idea of accountable care is better care -- instead of just more care. Accountable care is about incentivizing providers not just to fix whatever problem the patient came in with -- but also to help ensure that the issue doesn't come up again. Even further, it encourages doctors to operate beyond individual silos -- potentially aiding identification of potential health issues before they come an expensive emergency room visit. And, particularly in chronic disease management, there are some exciting opportunities both to increase patient quality of life and to save both the government and private insurers a lot of money by helping patients keep to treatment regimens and monitoring patient health regularly.
In the video below, from Where The Money Is, The Motley Fool's investment show, health care analysts Michael Douglass and David Williamson explain some of the smart moves insurers are making in accountable care -- and the potential ways that this innovation can drive profit-friendly revenue growth in these stocks.