October 20, 2011 - HealthCare.gov
New Affordable Care Act Tools Offer Incentives for Providers to Work Together When Caring for People with Medicare
People with Medicare will be able to benefit from a new program designed to
encourage primary care doctors, specialists, hospitals, and other care providers
to coordinate their care under a final regulation on Accountable Care
Organizations issued today by the Department of Health and Human Services
(HHS).
On October 20, 2011, HHS announced final rules and a new opportunity for
financial support to help doctors, hospitals, and other health care providers
work together to improve the care for Medicare patients. By choosing to
become Accountable Care Organizations, providers will be able to share in
savings by better coordinating patient care, providing high quality care, and
using health care dollars more wisely.
These new final rules, which were made final after an extensive review of
comments and additional stakeholder input on the proposed rule, add a new option
for providers looking for support in coordinating patient care. The Accountable
Care Organization model of delivering care may not be right for every doctor,
practice, clinic, or hospital, but it adds to the extensive menu of options
offered through the Affordable Care Act to provide better health, better care
and lower costs not only for Medicare beneficiaries, but for all Americans.
The new rules establish a new voluntary Medicare Shared Savings
Program that helps doctors, hospitals, and other providers improve
their ability to coordinate care across all health care settings. Providers who
meet certain quality standards can share in any resulting savings.
The quality measures are organized into four domains:
- Patient experience
- Care coordination and patient safety
- Preventive health
- Caring for at-risk populations
The higher the quality of care providers deliver and the greater the
effectiveness of their care coordination, the more savings they may keep.
Federal savings could be up to $940 million over four years.
In a complementary program announced today, HHS is accepting applications
from providers to help test the Advance Payment model. This
model will test whether pre-paying a portion of future shared savings will
increase participation of physician-owned and rural Accountable Care
Organizations in the Medicare Shared Savings Program, and whether advance
payments will allow teams of providers to improve care for beneficiaries and
generate Medicare savings more quickly. The advance payments would be
recovered from any future shared savings achieved by the team of providers.
These two new opportunities create incentives for health care providers to
work together to treat an individual patient across care settings – including
doctorsf offices, hospitals, and long-term care facilities. Providers are
not required to participate in Accountable Care Organizations, and patients of
providers who participate continue to have control over which doctors they see
and what care they receive.
Improving Care for Patients
Any patient who sees multiple doctors understands the frustration of
fragmented and disconnected care: lost or unavailable medical charts, duplicated
medical procedures, or having to provide the same information over and over to
different health care providers. This lack of coordination is even worse
for patients with multiple chronic conditions who receive care from multiple
health care providers.
Improved care coordination supported by these programs will lift this burden
from patients, while improving the partnership between patients and doctors in
making health care decisions. People with Medicare will have better
control over their health care, and their doctors can provide better care
because they will communicate with the patientfs other care providers.
Patients choosing to receive care from providers participating in an
Accountable Care Organization will have access to information about how well the
organization is meeting the quality standards.
People with Medicare who receive care from a provider participating in an
Accountable Care Organization will retain their rights to see any physician or
hospital that participates in the Medicare program. In other words, an
Accountable Care Organization cannot restrict care or limit a Medicare
beneficiaryfs access to a physician or other health care professional. Medical
decision making remains the responsibility of the patient and his or her
doctor.
Helping Providers Coordinate Care
The two programs announced on October 20, 2011 are part of a broader effort
by the Obama Administration to improve the quality of health care not only for
Medicare beneficiaries, but for all Americans. The Affordable Care Act
supports several programs that help health care providers coordinate care.
- Through the Partnership for Patients, more than 6,000
organizations including hospitals, doctors, and others have pledged to reduce
hospital-acquired conditions and improve transitions in care.
- The Bundled Payments initiative gives providers
flexibility to work together to coordinate care for patients over the course
of a single episode of an illness.
- The Comprehensive Primary Care Initiative will allow
Medicare to join with other health care payers such as employer-based health
plans and/or Medicaid programs to invest in strengthening primary care.
- The testing of the Pioneer Accountable Care Organization
Model is designed for organizations with experience providing
integrated care across settings.
- The Federally Qualified Health Center (FQHC) Advanced Primary Care
Practice Demonstration program is helping FQHCs provide more
coordinated care and better access to primary care for Medicare
patients.
Medicare Shared Savings Program
The new Medicare Shared Savings Program is intended to give Medicare
fee-for-service beneficiaries the advantages of better coordination of care
whether they get care in the hospital, a nursing facility, their doctorfs
office, or their home. The goal is to deliver seamless, high quality care
for Medicare beneficiaries, and to make patients and providers true partners in
care decisions.
Providers Eligible to Participate
Under the final rule, a group of providers and suppliers of services agree to
work together with the goal that patients get the right care at the right time
in the right setting. The final rule requires that each group of providers
be held accountable for at least 5,000 beneficiaries annually for a period of
three years. Each group must include health care providers and Medicare
beneficiaries on its governing board.
All Medicare providers can participate in an Accountable Care Organization to
coordinate care, but only certain types of providers are able to sponsor
one. Those providers include physicians in group practice arrangements,
networks of individual practitioners, and hospitals that are partnering with or
employ eligible physicians, nurse practitioners, physician assistants, and
specialists. To help providers serving rural and other underserved areas,
the final rule allows Rural Health Clinics (RHCs) and Federally Qualified Health
Centers to work together to coordinate care for patients. In addition, in
the final rule, certain critical access hospitals are also eligible.
Measuring Quality Improvement
The final rule links the amount of shared savings an Accountable Care
Organization may receive, and in certain instances shared losses it may be
accountable for, to its performance on: 1) quality standards on patient
experience; 2) care coordination and patient safety; 3) preventive health; and
4) at-risk populations. These standards will be measured in a way that
accounts for providers who treat patients with more complex
conditions.
To earn shared savings the first performance year, providers must fully and
accurately report across all four domains of quality. Providers will begin
to share in savings based on how they perform in some of those 33 quality
measures in the second and third performance years.
Sharing Savings and Sharing Losses
CMS is implementing two models: a one-sided shared savings model, in which
providers only share in savings; and a two-sided shared savings and losses
model, in which providers also share in losses if growth in costs go up.
The proposed rule had required Accountable Care Organizations in the one-sided
shared savings model to share losses in the third year of the agreement
period. In response to comments, CMS has modified the proposal, and the
final rule allows Accountable Care Organizations to participate under the
one-sided shared savings-only model for the entire length of their first
agreement period. This will help organizations with less experience
coordinating care, such as some physician organizations or small or rural
providers, to gain experience before taking on the responsibility of sharing
losses. It also allows more experienced providers to take on the responsibility
of losses in exchange for greater potential rewards. Accountable Care
Organizations may share up to 50% of the savings under the one-sided model and
up to 60% of the savings under the two-sided model, depending on their quality
performance.
For each year, CMS will develop a target level of spending for each ACO to
determine its financial performance. Because health care spending for any group
of patients normally varies from year to year, CMS will also establish a minimum
savings and minimum loss rate that would account for these variations.
This protects the Medicare Trust Funds from sharing savings, and providers
against sharing in losses, due to normal variation in Medicare spending.
Both shared savings and shared losses will be calculated on the total savings or
losses, not just the amount by which the savings or losses exceed the minimum
savings or loss rate. In addition, the amount of shared savings would
depend on how well the team of providers performs on the quality measures
specified in the rule.
To view a chart highlighting some of the key differences between the proposed
and final rules visit: http://www.cms.gov/aco/downloads/Appendix-ACO-Table.pdf
(PDF- 106 KB)
Advance Payment Model
The Advance Payment Model tests whether advancing a portion of an Accountable
Care Organizationfs future shared savings will increase participation from
physician-owned and rural providers in the Medicare Shared Savings Program, and
whether advance payments will allow those teams of providers more quickly
improve care for beneficiaries and generate Medicare savings. The Advance
Payment Model was designed to support physician-owned and rural ACOs with
upfront infrastructure investments. These providers will receive payments
in advance that will be recouped as they achieve savings.
There are three ways provider groups may receive these payments:
- Upfront fixed payment
- Upfront payment based on the number of Medicare patients served
- Monthly payment based on the number of Medicare patients
This model is open only to physician-owned organizations, critical access
hospitals, and rural providers participating in the Shared Savings Program,
helping them become Accountable Care Organizations to improve care for their
patients. Application deadlines will match the Shared Savings
Program. For more details, visit http://innovations.cms.gov/areas-of-focus/seamless-and-coordinated-care-models/advance-payment/.
Antitrust Guidance for Providers
CMS has worked closely with the Department of Justice (DOJ) and the Federal
Trade Commission (FTC) to facilitate the creation of Accountable Care
Organizations by giving providers clear and practical guidance to form
innovative, integrated health care delivery systems without raising antitrust
issues.
Along with the final rule for the Shared Savings Program, DOJ and FTC have
issued a joint Statement of Enforcement Policy Regarding Accountable Care
Organizations Participating in the Medicare Shared Savings Program (gAntitrust
Policy Statementh). Under the Antitrust Policy Statement, the agencies
will give rule of reason treatment to an Accountable Care Organization if they
use the same governance and leadership structure and the same clinical and
administrative processes in the commercial market as it uses to qualify for and
participate in the Shared Savings Program.
In addition, the Antitrust Policy Statement outlines an expedited process
that Accountable Care Organizations can use to obtain further guidance about
their antitrust concerns. For more details, visit www.ftc.gov/opp/aco/ and http://www.justice.gov/atr/public/health_care/aco.html.
For More Information
The Shared Savings Program final rule can be found at: http://www.healthcare.gov/law/resources/regulations/index.html.
(See Final Rule on Shared Savings Program: Accountable Care
Organizations)
The Advanced Payment solicitation is posted at: http://innovations.cms.gov/areas-of-focus/seamless-and-coordinated-care-models/advance-payment/.
For more information on these two topics, fact sheets are posted at http://www.cms.gov/center/press.asp.
The joint CMS and Department of Health and Human Services Office of Inspector
General (OIG) Interim Final Rule with Comment Period addressing waivers of
certain fraud and abuse laws in connection with the Shared Savings Program can
be found at: http://www.healthcare.gov/law/resources/regulations/index.html.
(See Request for Public Comment on Final Waivers in Connection with
the Shared Savings Program)
The Antitrust Policy Statement is posted at: www.ftc.gov/opp/aco/ and http://www.justice.gov/atr/public/health_care/aco.html.
The Internal Revenue Service (IRS) Fact Sheet, Tax-Exempt Organizations
Participating in the Medicare Shared Savings Program Through Accountable Care
(FS-2001-11), is posted at: http://www.irs.gov/newsroom/article/0,,id=248490,00.html.
Posted on: October 20, 2011