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Articles Posted in Accountable Care Organizations

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In its proposed rule for accountable care organizations (“ACOs”), the Centers for Medicare and Medicaid Services (“CMS”) includes mandatory compliance plans as an element of its ACO-program integrity efforts. The compliance plan must include at least the following elements:

• A designated compliance officer who is not legal counsel to the ACO and who reports directly to the ACO’s governing body
• Mechanisms for identifying and addressing compliance problems related to the ACO’s operations and performance
• A method for employees or contractors of the ACO or ACO providers/suppliers to report suspected problems related to the ACO
• Compliance training of the ACO’s employees and contractors
• Requirement to report suspected violations of the law to an appropriate law enforcement agency.

Since the Patient Protection and Affordable Care Act’s enactment, adoption of compliance plans–both for ACOs and generally–has become mandatory for participation in Medicare, Medicaid and the Children’s Health Insurance Program.
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During late March, the Centers for Medicare and Medicaid Services (“CMS”) proposed a rule regarding Accountable Care Organizations (“ACOs”) and the Medicare Shared Savings Program, which will make payments of shared savings to ACOs (“Proposed Rule”). The Proposed Rule describes the amount of financial risk the participants will face and the type of data the providers will be expected to collect under CMS’ current vision for the program. Many believe in the ACO concept of higher quality care at reduced costs. However, the complaints regarding the actual Proposed Rule are numerous and multi-faceted. Even the high-profile health care centers such as the Cleveland Clinic, the Mayo Clinic, and Intermountain Healthcare, which were used as inspirations for the Medicare Shared Savings Program and its ACOs, are hesitant to participate. Among other obstacles, the financial investment that providers will need to dedicate to participate in the Medicare Shared Savings Program under the Proposed Rule (e.g., to add technology and staff necessary to track the quality data to be collected) may prove to be a barrier to their participation. CMS officials are aware of the issues raised by the Proposed Rule. Dr. Donald Berwick, the Administrator of CMS, has expressed CMS’ desire and commitment to cooperate with health care providers to work out the problems.
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It is often instructive to review the thinking of health care decision-makers as a tool to acquire insight on the direction of health care policy. In this regard, Dr. Donald Berwick, the administrator of the Centers for Medicare & Medicaid Services (“CMS”), recently authored an Op-Ed in the Wall Street Journal outlining his view of Medicare reform. In light of the fluidity of the debate on the direction of the federal health care program, we, at The Health Law Partners, have summarized the central principles in Dr. Berwick’s piece. While Dr. Berwick’s perspective is, by no means, devoid of the partisanship that has become so endemic in the health care debate, his article nonetheless demonstrates that the Administration intends to pursue the reform path enacted with the passage of the Patient Protection and Affordable Care Act (“PPACA”) in 2010. It is noteworthy that, subsequent to the publication of this article, Dr. Berwick has acknowledged that the negative reception of the proposed ACO rules by the provider community inevitably will result in modifications to those rules.

Medicare reform may be a crucial building block toward a brighter economic future for the country because, among other benefits, successful reform could reduce the country’s deficit and debt. The task, however, requires balancing the growing costs of Medicare with the enormous financial burden medical costs impose on families. A plan proposed by Republicans in Congress would shift the costs of healthcare to seniors and the disabled. The plan would eliminate guaranteed Medicare benefits, limit the choice of doctors and hospitals, and burden the average senior with $6,400 of insurance costs. Although Medicare spending might be reduced as a result, the overall cost of healthcare would continue to climb under this plan.

In the alternative, the Medicare system could follow the example set by other fields (e.g., the computer industry) and focus on lowering costs and improving efficiency. The groundwork for such an approach was laid out by the PPACA. Up to $1 billion will be invested by the Partnership for Patients to aid healthcare providers in improving the safety of care. This partnership will not only elevate the quality of health care delivery, but will reduce Medicare costs by an estimated $50 million. In another effort, CMS recently introduced a Proposed Rule for Accountable Care Organizations (“ACOs”). Under this rule, ACOs will coordinate patient care and facilitate better communication among providers to reduce duplicate tests and procedures which should result in decreased healthcare costs. According to Dr. Berwick, improving the quality of healthcare may prove to be the best route to successful Medicare reform and a brighter economic future for the country.
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In an effort to better educate the anesthesia community with regard to the impact of Accountable Care Organizations (“ACOs”) on the specialty, the ASA Ad Hoc Task Force on ACOs has been carefully analyzing the March 31, 2011 ACO proposed regulations. As a preliminary step, at the end of April 2011, the ASA released 21 FAQs relative to ACOs. The ASA also plans to continually update the FAQs as new information emerges. The ASA FAQs can be accessed here.
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On Thursday, March 31, 2011, the Centers for Medicare & Medicaid Services (“CMS”) provided the health care community with some much needed guidance by publishing its Proposed Rule regarding the Medicare Shared Savings Program (the “Shared Savings Program”) and its Accountable Care Organizations (“ACOs”). There is a sixty (60) day public comment period with respect to the Proposed Rule and CMS has encouraged members of the public, including physicians, to submit comments for consideration while the final regulations are being developed.

Within its almost 500 pages of text, the Proposed Rule sets forth an abundance of specific requirements that the ACOs will likely need to satisfy. In addition, the Proposed Rule provides further information regarding the payments that ACOs will receive from CMS. Notably, the Proposed Rule would not only allow ACOs to receive a share of the cost-savings that it generates based upon a benchmark set by CMS but would also require ACOs, at least eventually, to accept downside risk by requiring the ACOs to repay Medicare expenditures above the CMS benchmarks.

It is also important to note that the Proposed Rule was only one of several helpful publications simultaneously issued by Federal agencies, including the U.S. Department of Health and Human Services Office of Inspector General, the Federal Trade Commission, the Department of Justice and the Internal Revenue Service, in a coordinated effort to address barriers and resolve ambiguities with respect to the operation of the Shared Savings Program under health care fraud and abuse, anti-trust and tax exempt laws.

Additional information regarding each of these developments and the Proposed Rule itself can be found at http://www.cms.gov/sharedsavingsprogram/.
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Since the signing of the Patient Protection and Affordable Care Act (PPACA) last year, there has been considerable attention and interest within the industry towards accountable care organizations (ACOs). Accompanying this focus has been a series of questions regarding the compositional requirements, as well as the operational and structural opportunities to be afforded to (and limitations to be imposed upon) ACOs. Fortunately, for the myriad of hospital systems and other providers that are developing their clinical integration strategies, meaningful guidance may soon be forthcoming. At a Congressional hearing on March 11, Secretary Sebelius announced that the long-awaited ACO regulations are expected to be released within the next two weeks and that these regulations were designed to encourage a wide variety of healthcare collaborations. The Health Law Attorney Blog has been intently following ACO developments. Please check back for an update on the content of the to-be-released ACO regulations and the anticipated implications of these rules for the ever-evolving healthcare landscape.
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The Centers for Medicare & Medicaid Services (CMS) has officially requested comments from the physician community regarding policies and standards for accountable care organizations (ACOs) participating in the Medicare program under the Shared Savings Program or in connection with the Center for Medicare and Medicaid Innovation (CMMI).

CMS’s request focuses on three areas of interest: participation of solo and small practice providers in ACOs; attribution of beneficiaries to ACOs; and the assessment of performance, quality and efficiencies of ACOs. Below is a summary of the information CMS is seeking, but the full request and directions for submitting comments can be found here: http://tinyurl.com/2a29moo. Please note that the deadline for comments to be submitted to CMS is 5:00pm on December 3rd, 2010.

Solo and small practice providers. How can solo and small practice providers be ensured equal opportunity to participate in Shared Savings Plans created by the Medicare program? How can these providers be given sufficient access to capital needed to fund their efforts? Should CMS consider other payment models besides those currently available to Medicare providers?

Attribution of beneficiaries. CMS is seeking a seamless attribution process of beneficiaries to ACOs. What is the best process and timing for this: before the start of a performance period, in order to target care coordination strategies, or at the end of a performance period to ensure accountability?

ACO Assessment. How can CMS evaluate ACOs based on the patient-centered criteria required by the Affordable Care Act? What quality measures should the secretary of the U.S. Department of Health and Human Services use to determine performance in the Shared Savings Program?

In a letter from the American Hospital Association (AHA) to CMS dated November 17, 2010, the AHA outlined principles that it would like to see guide the agency’s approach to implementing ACOs. It said the goal of ACOs must be “delivery reform that improves quality, efficiency and the patient experience through accountable care,” and suggested that the need for Medicare program savings should not hinder this type of delivery reform. The AHA’s position is that the ACO program should be “treated as a pilot initially so that mid-course corrections can be implemented to reflect what is learned.” Importantly, the association encouraged CMS to “explore opportunities to extend similar arrangements to rural providers who are interested in adopting delivery reforms.” The full text of the AHA’s letter to CMS can be seen here: http://tinyurl.com/299xnqo.

The Premier healthcare alliance, based in Charlotte, NC, is also among the major healthcare organizations who have already submitted a letter with recommendations to CMS regarding ACOs. Premier’s letter asks that the Medicare ACO program be “flexible enough to allow innovation, but rigid enough so that the initial ACOs in the program inspire confidence in the concept.” Premier also encouraged CMS to recognize physician assistants, nurse practitioners and certified nurse specialists as clinical providers that are equally eligible for Medicare Shared Savings bonuses. Like the AHA, Premier believes that such non-physician practitioners “will be central in developing a strong primary care base, particularly in rural and shortage areas.” Premier’s letter can be found here in its entirety: http://tinyurl.com/2vd26of.

Finally, the American Medical Association (AMA) defined a robust set of guidelines for ACOs at the organization’s semi-annual policy-making meeting. These principles, which happen to coincide with CMS’s request for comments and recommendations, emphasize that ACOs must be physician-led to guarantee quality patient care, be patient-centered in their focus, ensure that physician and patient participation stays voluntary and enable independent physicians to participate. The latter is of particular concern to the AMA, as significant barriers must be addressed to guarantee that physicians in all practice sizes can be successful in the new ACO models. For solo and small practice physicians, these barriers include a lack of resources, existing antitrust rules and conflicting federal policies. The AMA urges CMS to keep quality performance standards consistent with AMA policy and to allow ACOs to use different payment models. A complete list of all 13 principles of the AMA’s new policy regarding accountable care organizations can be found here: http://tinyurl.com/2aamuyz.

Please continue to visit www.thehlp.com for further ACO-related developments and, in particular, view the resources at our ACO page.
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Pursuant to our September 11, 2010 blog entry, the FTC is to hold a day-long workshop entitled “Workshop Regarding Accountable Care Organizations and Implications Regarding Antitrust, Physician Self-Referral, Anti-Kickback and Civil Monetary Penalty Laws.” According to the workshop’s website, those who are unable to attend the Baltimore workshop may listen in via webcast. Registration is not required for the webcast. HLP will be listening in on the webcast and will provide our readers with our summary of the workshop. Please stay tuned for more updates!
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The Federal Trade Commission (“FTC”), Centers for Medicare and Medicaid Services (“CMS”), and Department of Health and Human Services Office of Inspector General (“OIG”) have announced their plans to co-host an October 5th workshop on accountable care organizations (“ACOs”). According to a September 8th News Release, the workshop is intended principally to assist providers in their efforts to develop ACOs. Substantively, the October 5th workshop is expected to address and solicit public comments on the legal issues raised by the different ACO structural models, focusing on those of interest to physicians, physician associations, hospitals, health systems, payors, and other stakeholders. For example, it would be anticipated that the federal agencies will discuss legal considerations for the use of physician-hospital organizations as a platform for ACOs. Topics to be covered, which will be further discussed with greater specificity in an upcoming notice to be published in the Federal Register, will include the antitrust, physician self-referral, anti-kickback, and civil monetary penalty laws related to ACOs. Those interested in submitting comments to the FTC, CMS and OIG, on the topics to be discussed during the workshop are invited to deliver such comments by September 27th. Please check HLP’s THE HEALTH LAW ATTORNEY BLOG for updates as additional information is released regarding ACOs, in general, and the October 5th workshop, in particular.
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