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AMA Submits Comments to CMS Regarding ACO Proposed Rule

On Friday, June 3, the American Medical Association (“AMA”) submitted its comments concerning the Accountable Care Organizations (“ACOs”) Proposed Rule (the “Proposed Rule”) to Donald Berwick, the Centers for Medicare and Medicaid Services (“CMS”) Administrator. The Proposed Rule was issued by CMS on March 31, 2011. In its comments, AMA provided its views and recommendations regarding the Proposed Rule while reiterating its belief that a successful ACO model “can be an effective tool to improve quality, manage care coordination, reduce health care costs, and create a supportive environment for practicing physicians.” However, AMA urged CMS to issue an interim final rule to allow for the flexibility to change and improve the regulations as more information about the ACO model becomes available.

AMA addressed a number of issues in its extensive comments. First, AMA suggested changes to the proposed ACO payment and risk structure. AMA recommended the inclusion of at least one shared savings only option which would not include a mandatory shared loss provision in order to encourage participation by a greater variety of practices. AMA believes that without such an option participation could be unnecessarily limited because providers already have an incentive to become more cost-effective without the down-side risk provision. In the alternative, AMA suggested that the shared savings only option should, at the very least, be extended to smaller ACOs. AMA also urged CMS to allow health care providers to bill Medicare for procedures which are not currently billable under payment options which embrace down-side risk. AMA also suggested that ACOs share in a portion of all savings that are achieved without a minimum savings threshold, and that CMS increase the savings percentage ACOs are eligible to receive, especially at the beginning of the program. AMA also urged the removal of the withholding and line of credit provision of the Proposed Rule and suggested adjustments to the expenditure benchmark based on the health status of an ACO’s patients during the performance period. Lastly, AMA urged the exclusion of the care costs for outlier patients from the savings calculation.

Next, AMA urged the inclusion of a number of transitional ACO models in order to encourage small and solo practice participation in ACOs. AMA urged “CMS to allow these alternative ACOs to share in a percentage of all savings that are achieved, rather than simply sharing in the savings above the minimum savings threshold proposed in the rule.”

AMA also urged CMS to accept a more flexible approach to ACO beneficiary assignment. At the very least, AMA urged CMS to strike a balance between prospective and retrospective attribution. However, AMA stated that ideally “CMS should adopt a prospective approach that allows patients to volunteer to be part of the ACO and permits the ACOs to know up-front those beneficiaries for whom the ACO will be responsible.” AMA believes that these proactive efforts are crucial in order to encourage and educate beneficiaries to behave in ways which will make ACOs successful.

Next, AMA expressed its views regarding the quality measures and other reporting requirements found in the Proposed Rule. AMA urged CMS to “(1) align quality measure domains and quality measures across its programs (including the ACO, Electronic Health Record [EHR] Incentive Program, and PQRS) and reduce the number of required measures in the initial years; (2) provide ACOs with some flexibility of measure selection; (3) reconsider data submission methods; and (4) support clinical quality registries as a significant data submission method.” Among the numerous specific suggestions, AMA urged that CMS publish the required quality measures at least 90 days prior to the initial effective date of the ACO program and modify the 100 percent reporting on all measures requirement which is currently necessary under the proposed rule to qualify providers for a share of the savings.

AMA went on to address a number of other issues. AMA was pleased with the overall ACO governance structure proposal, but suggested some differing requirements for oversight of ACOs. AMA went on to disagree with the exclusion of rural health clinics from the proposed plan. Next, AMA agreed with CMS’ overall attempt to propose waivers of federal program integrity laws in an effort to “test new payment models and methods that improve patient outcomes and promote value” and suggested a few improvements. Subsequently, AMA also urged CMS to consider its letter to the Federal Trade Commission (“FTC”) and the Department of Justice (“DOJ”), which it recently wrote in response to the Statement of Antitrust Enforcement Policy, alongside the comments that AMA has provided to CMS. Lastly, AMA further urged CMS to ensure that tax-exempt ACOs may distribute the shared savings to ACO-participating providers or stakeholders without losing the ACO’s tax-exempt status.

For the complete text of the comments, please click here.

For more information regarding ACOs, please contact Carey F. Kalmowitz, Esq. or Esq. at (248) 996-8510 or (212) 734-0128, or visit the HLP website.

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