The Centers for Medicare and Medicaid Services (CMS) released the Final Rule to establish Accountable Care Organizations (ACOs) under the Medicare Shared Savings Program (Shared Savings Program) on Oct. 20, 2011. The Final Rule takes into account more than 1,300 stakeholder comments that CMS received after the release of the proposed rule on March 31, 2011.

CMS made the following noteworthy modifications to the proposed rule, intending to make the Shared Savings Program more flexible for and attractive to potential providers:

  • Changed the beneficiary assignment process from retrospective to prospective;
  • Reduced the requisite number of quality measures providers must report (from 65 to 33);
  • Established a rolling admissions process, allowing providers to seek ACO status through 2012;
  • Eliminated mandatory antitrust review for the program’s largest organizations;
  • Modified the one-sided model (shared savings for years 1 and 2, but both shared savings and losses in year 3), eliminating provider risk entirely under this option, while, at the same time, maintaining the two-sided model option, which provides higher sharing rates for ACOs willing to share in performance-based risk;
  • Eliminated requirement that 50 percent of primary care physicians be defined as meaningful electronic health record (EHR) users, while nonetheless establishing EHR as the most significant quality measure for quality-scoring purposes; and
  • Extended benefits of the Shared Savings Program to a broader range of beneficiaries, now including Rural Health Clinics and Federally Qualified Health Centers.

ACOs under the Medicare Shared Savings Program (Shared Savings Program), provided for in the Patient Protection and Affordable Care Act (PPACA), are required to be established by January 1, 2012.