APRIL 5, 2011 / Issue 13
ACO Regulations Update
Viewpoint: Medicare Shared Savings Program and Accountable Care Notice of Proposed Rulemaking (NPRM)

 By Justin Barnes

The March 31 Notice of Proposed Rulemaking (NPRM), taken initially, presents as a flexibly tiered and well-thought-out proposal to aid in the improvement of care coordination and care quality while vigorously attempting to control healthcare costs – primarily by slowing down the growth in Medicare spending toward achieving a smarter, more sustainable healthcare system.

Many of us became anxious in recent months due to original expectations that the proposal would appear last December, and we all know that anxiousness grew in recent weeks. Now upon review, I believe the time taken will prove well spent, and that the proposed launching of accountable care organization (ACO) models on January 1, 2012, can be achieved, aided by the immediate commentary period through June 6.

The proposal’s goal is to rightly confront a costly and fragmented system by creating communities of health models that incorporate primary care or multi-specialty physician groups, hospitals, home health services, rehabilitation centers and other appropriate institutions.

The proposal takes a logical approach by building upon existing Physician Quality Reporting System (PQRS), Hospital Inpatient Quality Reporting (IQR) and, of course, the burgeoning meaningful-use program, all proven initiatives that are also at their heart systems of improved patient care through quality reporting that result in provider incentives based on care coordination and ultimately lowered costs.

It’s very clear that accountable care is aligned with the meaningful-use goals with today’s proposed language that by year two of Shared Savings, at least 50 percent of primary care providers are meaningful users of EHRs. This optimistic element of the NPRM also promises greater alignment in the future, which could provide even greater incentive funds to participating physicians.

To that end, the proposal’s establishment of a range of 65 quality measures in five categories: care coordination, patient safety, preventive health, an at-risk and elderly patient focus, and that of patient/caregiver interaction, speaks both to flexibility and established incentivized quality care programs like meaningful use. Another applauded crossover with meaningful use is the proposal’s provision that additional shared savings are available for providers in ACOs that include patients receiving care in federally qualified health centers and rural health clinics during a performance year.

Of course, one of the key elements to take ACOs from a proposal to a reality is the continued adoption and implementation of certified electronic health records (EHRs) which can provide the integration, data sharing and interoperability to bring the communities of health models to life. Here is where CMS, ONC and many other agencies are combining programs to truly create a sustainable healthcare system.

I’m also pleased that this proposal clearly meets expectations in terms of the homework, if you will, that CMS tackled by really conducting a comment phase prior to release that included voices from HHS, the Office of the Inspector General, the Department of Justice, the Federal Trade Commission and IRS to evaluate any considerations to anti-trust or tax laws that have been the center of many media articles and broadcasts on this program.

The proposal also shows its teeth by proposing a minimum sharing benchmark rate ACOs can strive for. We know that longstanding ACO models such as those undertaken by the Mayo and Cleveland clinics are workable, and it’s also noteworthy that this proposal seeks to embrace knowledge and experiences from private payers.

I am particularly pleased to see the expected flexibilities included in the proposal: voluntary participation by providers and a clear message to patients that ACOs are not the creation of in-network doctors, but an equally flexible system of value-based purchasing and care choices that encourage preventive medicine, decreased hospital stays and certainly decreased hospital re-admissions.

The proposal also gives choice to providers of two initial shared savings risk models to select: two-year shared savings followed by shared savings and any losses in year three, or shared savings and losses for a three-year period. I suspect if done right, losses won’t be a factor.

As providers, hospitals and healthcare institutions review their options, I believe they can feel secure that the commitment to clinical, financial and administrative integration is wholly achievable with today’s leading EHRs and attendant technologies of patient portals, automated referrals, clinical alerts, orders tracking and many more innovations.

We know what the possibilities are, and we also know that, for example, one in five of hospitalized Medicare patients is readmitted within 30 days, and that medication errors persist. It’s a fixable system.

In his comments March 31, CMS Administrator Dr. Donald Berwick noted that the Medicare fee-for-service (FFS) structure plays a role in a fragmented healthcare delivery system, yet the NPRM clearly states that FFS part A and B will remain in place. Stakeholders will be interested in how these elements can be reconciled to achieve the cost goals of shared savings and ACO structures.

With any proposal of this magnitude and scope, this and may other areas will require careful consideration in the coming months that we can all benefit from.

About the author
Justin Barnes is chairman emeritus, Electronic Health Record Association (EHR Association) and vice president of marketing, corporate development and government affairs, Greenway Medical Technologies, Inc.

ACO Regulations Update
CMS releases ACO rules

On March 31, 2011, the Department of Health and Human Services, CMS, issued proposed regulations governing accountable care organizations (ACOs) under the Medicare Shared Savings Program established by the Patient Protection and Affordable Care Act of 2010. ACOs, which according to HHS “create incentives for healthcare providers to work together to treat an individual patient across care settings,” are slated to start in Jan. 2012. Before the rule is finalized, CMS will review all comments from the public and may make changes to its proposals based on those comments. You can download the full regulations document here.

ACOs: Improving care coordination for people with Medicare
Review a handy federal fact sheet. (HealthCare.gov)
FAQ on ACOs: Accountable care organizations explained
The basics and a little more about the “hottest three-letter word in healthcare.” (Kaiser Health News)
10 key points in newly released proposed rules on ACOs
Learn about projected savings, who can join and more. (Becker’s ACS Review.)
HHS unveils ACO details
Includes many links to commentaries and extra stories. (Kaiser Health News)

Get ready for 5010

This week a broad group of healthcare industry stakeholders is putting on a series of free webinars to help with the transition to Version 5010, which is less than 10 months away. You can still get in on the action at 1 p.m. EST every day from now until Friday by registering for one or more sessions covering: large practices and facilities (4/5), Medicare fee for service (4/6), clearinghouses (4/7) and commercial payers (4/8). The Centers for Medicare & Medicaid Services (CMS) is supporting this educational effort.


Featured Survey
Be heard: Take part in the 2011 Data Management Survey

Healthcare storage virtualization company BridgeHead Software has posted the online questionnaire for its second annual Healthcare IT Leadership Perspectives: Data Management Survey for IT professionals. Share your opinions, and you may even snag an iPad, a Garmin navigation device or an Amazon.com voucher. Survey runs from March 23 through May 13, 2011.


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