ACO Final Rules Ease Requirements, Reduce Risk

Cheryl Clark, for HealthLeaders Media , October 20, 2011

Cost Sharing with Medicare
ACOs would be able to share cost savings with Medicare after the first dollar of savings, rather than reach a threshold of 2% reduction as the proposal required.  For example, if the baseline cost of care was $1 million, the ACO would have had to achieve a $20,000 saving before retaining half of that saving. Now, any saving below the baseline may be shared at a 50% or 60% split, depending on the type of ACO.

Quality Measures
CMS will phase in quality measures, starting with 33 instead of the originally proposed 65.  Those deleted include a composite score for 11 types of healthcare acquired conditions, and fewer composite measures for disease conditions such as diabetes, heart failure, ischemic vascular disease and coronary artery disease.

Expanded List of Eligible Providers
The final rule added to the list of types of providers who could form an ACO Federally Qualified Health Centers and Rural Health Clinics.

Advanced Payment Model
A new program called the Advanced Payment Model allows for selected ACOs to receive three types of payments: An up front fixed payment, an up front,variable payment, or a monthly payment of varying amount "depending on the number of Medicare beneficiaries historically attributed to the ACO."

"When folks see the rules and the many changes, they will see that CMS listens," said CMS Deputy Administrator and Director of the Center for Medicare Jonathan Blum. While the program "is responsive to the comments to ensure momentum and to ensure participation, but at the same time it's not taking away the quality goals and the care improvement goals that we have."

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