Is the ACO DOA? Reasonable Minds Can Improve the Draft Regulations

In the current all-ACO, all the time, health care policy news cycle, we’ve been inundated with declarations that the ACO is dead, because a handful of big boys say they don’t want to play.

Today, CMS announced that it is tinkering with the proposed ACO rules by offering three variations on the ACO theme (link to press release; see also CMS ACO fact sheet).  From the fact sheet:

  • Pioneer ACO Model: The Innovation Center is now accepting applications for the Pioneer ACO Model, which will provide a faster path for mature ACOs that have already begun coordinating care for patients.  The Pioneer ACO model is estimated to save Medicare as much as $430 million over three years by better managing care for beneficiaries and eliminating duplication.  And it is designed to work in coordination with private payers in order to achieve cost savings and improve quality across the ACO, thus improving health outcomes and reducing costs for employers and patients with private insurance.
  • Advance Payment ACO Initiative: The Innovation Center is seeking public comments on whether it should offer an Advance Payment Initiative that would allow certain ACOs participating in the Medicare Shared Savings Program access to a portion of their shared savings up front, helping providers make the infrastructure and staff investments crucial to successful ACOs.  Comments should be submitted by June 17th, 2011.
  • Accelerated Development Learning Sessions: Providers interested in learning more about the steps necessary to become an ACO can attend an upcoming series of Accelerated Development Learning Sessions.  These convenient and free sessions will help providers learn what steps they can take to improve care delivery and how to develop an action plan for moving toward better-coordinated care.

Together with the Medicare Shared Savings Program, the initiatives announced today give providers a broad range of options and support that reflect the varying needs of providers in embarking on delivery system reforms.

CMS has recently hinted that it will be rejiggering the rules to encourage physician-led ACOs, too (an approach I have previously endorsed).

So, I think that the histrionics are more about influencing the final form of the regulations than truly backing away from participation in a Medicare Shared Savings Program.  Now is the time to put pen to paper — or fingers to keyboard — in order to get comments on the proposed rule in to CMS.  As ever, the perfect is the enemy of the good, and we clearly need to do something.  Over at the Health Affairs blog today, Ron Klar offers the first of three installments of suggested improvements to the ACO rules.  Food for thought.  In a wonderful display of synchronicity, Governor Deval Patrick offered testimony just yesterday on the all-payor ACO bill that he has filed here in Massachusetts.  The CMS rules — with any luck — will be finalized before final action on Patrick’s bill, but it is important to keep in mind that the ACO framework, while focused on Medicare today, may well be expanding to all payors in the future.  In an all-payor environment — and even in the Medicare environment — there is still time to consider alternative approaches to a variety of the proposals laid out in the proposed ACO rule.

What’s your pet peeve about the proposed rule?

David Harlow writes at HealthBlawg, a nationally-recognized health care law and policy blog. He is an attorney and lectures extensively on health law topics to attorneys and to health care providers. Prior to entering private practice, he served as Deputy General Counsel of the Massachusetts Department of Public Health.

1 reply »

  1. Hi David,
    My pet peeve is the fact that the annual health evaluations written into some ACO plans already in implementation will result in practices being negatively reinforced to care for the sickest patients or in patients being penalized for getting sick with higher premiums. These are the kinds of market forces that may result in those in the most need having the least care or still back into the ER for primary care because no one will take them.

    Good article. ACOs have a great deal of potential but the devil is in the details.