Final ACO Regulations Released

The Centers for Medicare and Medicaid Services (CMS) released the final regulations for Medicare Accountable Care Organizations. CMS also announced that it would accept applications for an Advance Payment Model ACO designed to provide support to physician-owned and rural providers which wish to operate as Medicare ACOs.

The final Medicare ACO rules make important changes to the much-criticized ACO rules proposed last March. The changes include removing two-sided risk from the Track 1 model; preliminary prospective assignment of beneficiaries; a substantial reduction in the number of quality measures that must be met; sharing in first dollar savings once a minimum savings rate is achieved; and removing the requirement that at least 50% of participating primary care physicians use EHRs.

According to CMS, the final ACO regulations include a number of improvements based upon the more than 1,300 comments it received on the proposed rules. CMS administrator, Donald M. Berwick, M.D., stated: “The final rule will increase the incentives and streamline the Shared Savings Program, extending the benefits of the new program to a broader range of beneficiaries.

The first ACO agreements with CMS are expected to start April 1, 2012, and July 1, 2012.

CMS and the Office of Inspector General have simultaneously issued an interim final rule establishing waivers for ACOs from the Stark Law, Anti-Kickback Statute, and Civil Monetary Penalties law.

Concurrently, the Federal Trade Commission and the Department of Justice have issued a Final Policy Statement regarding antitrust enforcement policy for ACOs.

We will be sending additional Health Law Bulletins to explain the final regulations. In the interim, please feel free to contact us if you have any questions.