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CMS releases final rule on ACOs

October 20, 2011
by root
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The Centers for Medicare & Medicaid Services (CMS) today released its final rule for accountable care organizations (ACOs). (Click here for a comparison between the proposed rule and today’s final rule.)

Created by the Affordable Care Act, the two initiatives launched today include the Medicare Shared Savings Program and the Advance Payment model.

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.

Both the Medicare Shared Savings Program and Advance Payment model create incentives for healthcare providers to work together to treat an individual patient across care settings—including doctors’ offices, hospitals and long-term care facilities.

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.

“As a physician I understand the complexities of caring for a patient who may have multiple providers,” said Donald M. Berwick, MD, administrator of CMS. “This opportunity to coordinate care among providers could greatly improve the quality of care Medicare beneficiaries receive.

“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 continued. “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 making the one-sided model truly one-sided, 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, said CMS.

The American Health Care Association’s press department in an email to Long-Term Living commented on the final rule:

“We support the concepts of ACOs and their intended purpose, and certainly want to ensure skilled nursing and post-acute facilities are part of the cost-saving model. We’ll be examining the details in the coming days and weeks to ensure our sector can play an important role moving forward.”

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