After much anticipation, several federal agencies released documents today addressing legal issues regarding Accountable Care Organizations (ACOs). Significantly, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule that would establish ACOs under the Medicare Shared Savings Program created by the health reform legislation. The proposed rule will be published in the Federal Register on April 7, 2011, and calls for a 60-day public comment period.
Under the Patient Protection and Affordable Care Act, the Shared Savings Program will reward ACOs that lower cost while meeting quality standards. The program must be established by January 1, 2012. Under the proposed rule, CMS:
- Proposes an operational definition of an ACO, and defines proposed eligibility requirements for an ACO to participate in the Shared Savings Program;
- Outlines proposed relationship requirements with ACOs, including a 3-year participation agreement and data sharing requirements;
- Proposes a methodology for assigning beneficiaries to an ACO, defining quality measures and ACO performance measurement under the Shared Savings Program;
- Describes proposed methods related to the measurement and payment of shared savings, including the establishment of expenditure benchmarks, performance targets and others;
- Proposes methods to introduce risk into the Shared Savings Program over a period of years;
- Sets forth proposed methods to monitor ACO performance, along with grounds and procedures for termination of ACO agreements; and
- Addresses other issues, including coordination of the proposal with other federal agencies.
CMS and the Office of Inspector General also jointly released a notice with comment period outlining proposals for waivers of certain federal fraud and abuse laws for ACOs, including the Stark Law, the Anti-Kickback Statute, and certain provisions of the Civil Monetary Penalties Law. Additionally, the Federal Trade Commission (FTC) and the Department of Justice (DOJ) jointly issued a proposed antitrust policy statement regarding ACOs participating in the Shared Savings Program. The Internal Revenue Service also issued a notice requesting comments regarding the need for guidance on participation by tax-exempt organizations in the Shared Savings Programs through ACOs.