Industry reports and comments by regulators suggest that CMS’ proposed rule
on the Shared Savings Program for ACOs is expected to be released in the very near
future. The much-anticipated proposed rule was submitted to the Office of
Management and Budget for review on Feb. 14, 2011, where it remains. Sources
indicate the delay may be due to issues regarding application of federal
antitrust laws by the Federal Trade Commission (FTC) and the Department of
Justice (DOJ). CMS Administrator Dr. Donald Berwick has stated there may be
simultaneous guidance from CMS, the FTC and DOJ regarding application of
antitrust laws to ACOs under the Shared Savings Program and similar initiatives
involving commercial health plans.
The Shared Savings Program was created by Section 3022 of the Patient
Protection and Accountable Care Act (the Act). Under the Shared Savings Program
– to take effect no later than Jan. 1, 2012 – ACOs meeting certain requirements
established by the Secretary of Health and Human Services will be eligible to
receive additional payments from Medicare where certain performance guidelines
are met and cost-savings targets are achieved. The amount of the additional
payment will be a percentage of the difference between the estimated per capita
Medicare expenditures for patients assigned to the ACO and the cost-savings per
capita Medicare expenditures threshold.
CMS has issued scant guidance on any specifics about participation in the
Shared Savings Program aside from a brief
Preliminary Questions & Answers document posted on its website (the Q&A). As
a result, a number of
unanswered questions about ACOs and the Shared Savings Program exist, and
industry representatives are hopeful the proposed rule will include more
concrete information to allow healthcare providers to proceed with the further
development of ACOs.
It’s not clear now what information will be included in the proposed rule,
but the CMS request for information included in the Nov. 17, 2010, edition of
the Federal Register, 75 Fed. Reg. 70165-66, provides some insights into the
issues that CMS may address, including:
- What standards will be adopted to ensure that groups of solo and small
practice providers have the opportunity to actively participate in the
Shared Savings Program and other ACO models developed by CMS?
- What payment models or financing mechanisms might be used to address
limited access to capital or other resources for small practices to fund
efforts from which shared savings may be generated?
- What patient attribution model should be used – one that attributes
patients in advance of the performance period, or one that attributes
patients at the end of the performance period?
- How should beneficiary and caregiver experience of care be assessed as
part of ACO performance?
- What patient-centered criteria should be included in assessing ACO
- What quality performance measures should be included in assessing ACO
- What additional payment models should CMS consider aside from the Shared
Savings Program and other ACO pilot projects?
The proposed rule may also include discussion of how Stark physician
self-referral laws are to be applied to ACOs. This could involve efforts to
finalize the exception under Stark for incentive payment and shared savings
programs included in the Medicare Physician Fee Schedule proposed rule
for CY 2009. It could also involve a waiver of application of Stark laws for
ACOs meeting certain requirements established by CMS, as this authority is
included in the Act.
It’s also possible that the Department of Health and Human Services Office of
Inspector General (OIG) could issue simultaneous guidance on application of the
federal Anti-kickback Law prohibiting payment of remuneration for referrals and
Civil Monetary Penalty Law prohibiting beneficiary inducements and payments made
to reduce the type or amount of services provided to beneficiaries. This could
likewise involve a waiver of application of these laws for ACOs meeting certain
requirements established by the OIG, as this authority is also included in the
We will monitor the release of the proposed rule and provide future updates
on this news alert, as more information becomes available. If you would like to
discuss the development of ACOs, specifics about the Shared Savings Program, or
any other matter involved in healthcare reform, please contact one of the
authors or another member of McGuireWoods’ Healthcare Department.
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