Easing the Pathway to Accountable Care Organizations

Final Administration Policy

Accountable Care Organizations (ACOs) have the promise to transform how health care is delivered by sharing financial awards among providers that realize savings in health care spending while improving quality.

These authors review the October 2011 regulatory policy statements related to the Medicare Shared Savings Program, clarifying some policies and altering others.

Key Findings:

  • Medicare patients served by federally qualified health centers and rural health clinics can be assigned to ACOs, paving the way for Medicaid to adopt the ACO model and serve dually eligible patients.
  • Beneficiaries will be assigned an ACO at the beginning of a performance year, prospectively, rather than retrospectively. Various governance, structural and operational requirements for ACOs were eased.
  • The number of quality performance measures was reduced (from 65 to 33) by removing and combining some.
  • The rules for calculating incentives changed, allowing ACOs experiencing losses to continue in the program, with limitations.
  • Data sharing expanded to include identifiable claims data use for ACO operational purposes.

Other changes relax antitrust enforcement policy, provide waivers of fraud and abuse laws, and offer guidance on ACO tax-exempt status.

These changes were designed to make the ACO model attractive to a medical community just beginning to engage in value-based purchasing.