Health Reform Implementation: Medicare Accountable Care Organizations Under Development

From AAPD (4.15.11):

Implementation of Health Care Reform: Changes for Medicare Beneficiaries

By Jenifer Simpson, Government Affairs, AAPD

On Friday, April 8, 2011, AAPD participated in a briefing held by the Centers for Medicare and Medicaid Services (CMS), the administrative agency for these health care financing mechanisms for people with disabilities.  A key speaker was Center for Medicare Management Director Jonathan Blum, who discussed proposed new rules to help doctors, hospitals, and other health care providers offer better coordinated care for Medicare patients through Accountable Care Organizations (ACOs).  The conference call was set up because CMS is soliciting comments on proposed rules for ACOs that were issued March 31, 2011. Formation of ACOs are one way the new health care reform law will be implemented.  Here is a summary of what AAPD learned about the ACOs and how they may affect some people with disabilities:

About ACOs:  The ACO must take responsibility for at least 5,000 (Medicare) beneficiaries for a period of three years, as suggested in the law, and is provider based.  Note that patient and provider participation in an ACO is purely voluntary; AAPD is not clear if beneficiaries will be contacted first either by CMS or the ACO but hopes to learn about this as implementation gets underway.  Significantly, for people with disabilities, the new health care law requires each ACO to include health care providers, suppliers, and Medicare beneficiaries – which includes people with disabilities -- on its governing board.

Savings: These ACO entities are intended to create cost savings through lowering growth rates in Medicare expenditures through coordination of service. This is through facilitating incentives for health care providers to work together to treat an individual patient across different care settings such as doctor’s offices, hospitals, and long-term care facilities. CMS’s Medicare Shared Savings Program (SSP) will reward ACOs that lower growth in health care costs while meeting performance standards on quality of care and by putting patients first. CMS believes that via its proposed regulations for ACOs, Medicare could potentially save as much as $960 million over three years. 

How it Works: Under the proposed rule, Medicare would continue to pay individual health care providers and suppliers for specific items and services as it currently does under the Original Medicare payment systems.  CMS would now also develop a benchmark for each ACO against which ACO performance is measured to assess whether it qualifies to receive shared savings, or to be held accountable for losses.  CMS is also proposing to establish a minimum sharing rate that would account for normal variations in health care spending, so that the ACO would be entitled to shared savings only when savings exceeded the minimum sharing rate.  The amount of shared savings depends on whether on an ACO meets or exceeds quality performance standards. The proposed rule would provide for additional shared savings for ACOs that include beneficiaries who receive services from a Federally Qualified Health Center or Rural Health Clinic during the performance year.

Care Quality: The rule proposes to measure quality of care in five domains that affect patient care: these are patient/caregiver experience of care; care coordination; patient safety; preventive health; and at-risk population/frail elderly health. The ACO must have a beneficiary care survey in place, must have patients in its governing body and must address diversity in its governance board and in delivery of care.

Consumer Education Steps:

1. For more information about the SSP and ACOs, read the fact sheet at http://www.HealthCare.gov/news/factsheets/accountablecare03312011a.html.
2. Also HHS Press release is informative, at http://www.hhs.gov/news/press/2011pres/03/20110331a.html.
3. Read a transcript of the April 8 CMS briefing at http://www.cms.gov/sharedsavingsprogram
4. Read the proposed CMS regulations, posted at http://www.ofr.gov/inspection.aspx.
5. To send in comments, go to CMS website. The File code is CMS-1345-P-2 which must appear in your comments. You can comment electronically on these regulations at http://www.regulations.gov. Follow the "Submit a comment" instructions. Comments are due at the end of May.
6. If you are a Medicare beneficiary, think about how you might want to become involved with an Accredited Care Organization (ACO) if they are formed in your local area. Your role on the governance board could be critical to ensuring quality service delivery for people with disabilities.
7. If you have consumer-based comments or concerns about ACOs, please send them to AAPD at policy@aapd.com with “ACO” in the subject matter line, so we can raise them with CMS, as appropriate.

Comments

[Jenifer Simpson]

For a witty and interesting editorial viewpoint on the new ACO proposal by CMS read the Guest Opinion on the Kaiser Health news website at
http://www.kaiserhealthnews.org/Columns/2011/April/041811millenson.aspx

[amy amster]

The consumer education fact sheets are great. All the information you need to know about Medicare, can be found right here.
http://www.medicaresolutions.com