HHS: Final ACO rule issued, could equate to bigger incentives
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The two initiatives—the Medicare Shared Savings Program and the Advance Payment model—will help providers form ACOs and reflect the input provided by stakeholders as well as lessons learned by innovators in care coordination in the private sector, according to the HHS.
The two programs are:
- The Medicare Shared Savings Program will provide incentives for participating healthcare providers who agree to work together and become accountable for coordinating care for patients. Providers who band together through this model and who meet certain quality standards based upon, among other measures, patient outcomes and care coordination among the provider team, may share in savings they achieve for the Medicare program. The higher the quality of care providers deliver, the more shared savings the providers may keep.
- The Advance Payment model will provide additional support to physician-owned and rural providers participating in the Medicare Shared Savings Program who also would benefit from additional start-up resources to build the necessary infrastructure, such as new staff or information technology systems. The advanced payments would be recovered from any future shared savings achieved by the ACO.
Unlike a managed care plan, Medicare beneficiaries will not be locked into a restricted panel of providers. Rather, a determination of whether an ACO was responsible for coordinating care for a beneficiary will be based on whether that person received most of their primary care services from the organization.
HHS proposed its initial set of ACO guidelines on March 31, and sought comment on both the direction and the details of this important new program for Medicare. “[N]umerous suggestions were also offered for improvements to the proposed rule that would lead to a larger, more pluralistic set of ACO participants without compromising patient outcomes or choice,” Donald M. Berwick, MD, administrator of the Centers for Medicare & Medicaid Services (CMS), wrote in a New England Journal of Medicine perspective, also released Oct. 20. “In particular, commenters asked CMS to reduce barriers to entry by streamlining governance and reporting burdens on potential ACOs; improve the potential financial return for ACOs willing to make the necessary, and often substantial, investments to improve care; and ensure beneficiary protections.”
“We listened very carefully to the more than 1,300 comments we received on the proposed rule released this spring, and this final rule includes a number of improvements suggested by those comments that will strengthen the program,” Berwick said in a statement. “For example, the final rule will increase the incentives and streamline the Shared Savings Program, extending the benefits of the new program to a broader range of beneficiaries.”
Other changes from the proposed rule include establishing a one-sided model, expanding participation to rural health clinics and federally qualified health centers and organizations where specialists provide primary care, and providing a flexible starting date in 2012. Federal savings from this initiative could be up to $940 million over four years.
“Under the ACO model, Medicare beneficiaries are still free to seek care from any Medicare provider they wish,” Berwick wrote in the New England Journal of Medicine. “Indeed, Medicare beneficiaries should find their care experience enhanced by a program that supports providers in engaging with their patients to deliver on the three-part aim: better care for individuals, better health for populations and lower cost growth through improvements in care.
“Whether provided through ACOs or an alternative innovation opportunity, coordinated care is meant to allow providers to break away from the tyranny of the 15-minute visit, instill a renewed sense of collegiality and return to the type of medicine that patients and families want,” Berwick concluded in his perspective. “For patients, coordinated care means more 'quality time' with their physician and care team (a patient's advocate in an increasingly complex medical system) and more collaboration in leading a healthy life. And for Medicare, coordinated care represents the most promising path toward financial sustainability and away from alternatives that shift costs onto patients, providers and private purchasers.”
Associations, such as the American Medical Association and the American College of Cardiology (ACC), immediately commended the acceptance of many changes to the initial guidelines.
For instance, Jack C. Lewin, CEO of ACC, said: “We commend CMS for its decisions to be responsive to comments on the ACO rule, and we are supportive of the focus on quality of care and care related to cardiovascular disease within this final rule. While we do not know for certain how many organizations will form as ACOs in the coming years, we remain encouraged since these changes make it more feasible for physicians and hospitals to consider participating.”
The joint CMS and HHS’ Office of Inspector General (OIG) interim final rule with comment period addressing waivers of certain fraud and abuse laws in connection with the Shared Savings Program is posted here.