By Jonathan Block - February 6, 2012

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That was the headline of a blog opinion piece posted on The New York Times website on Jan. 30. With a title like that, how could the piece not be interesting? And although I personally disagree with some of their arguments, the authors, Ezekiel J. Emanuel and Jeffrey B. Liebman, both former advisors under President Obama, do make some valid points worth discussing.

Emanuel and Liebman, who are now, respectively, a Times contributing opinion writer and a professor of public policy at Harvard University, say that many health insurers do not even act as insurers since 60% of Americans who get their health coverage from their jobs are enrolled in self-insured plans. In these instances, it is the companies that take the financial risk, leaving the insurers to essentially act as an administrative services only provider.

But one of the key reasons Emanuel and Liebman posit for the industry’s potential demise is the rapid growth of accountable care organizations (ACOs). Because ACOs emphasize preventive care and getting physicians paid a fixed amount plus bonuses if patient outcomes are improved, this will eventually render the traditional fee-for-service system moot, they argue. In addition, ACOs are composed of local health care providers working together, so there no longer will be a need for complicated billings and claims processing, they add.

I’ve spoken with a number of analysts and industry consultants lately who tell me that the rise of ACOs and the patient-centered medical home models could also spell trouble for insurers as more of the public realizes the benefits of ACOs and alternative payment models, both in terms of cost savings and improved health.

And with insurers seemingly under constant fire by some lawmakers and the impacts of health care reform yet unknown, is it possible that the health insurance industry could be on its way out?