The Final Rule implementing the Medicare Shared Savings Program (MSSP) leaves no doubt that CMS is doing all it can to encourage the formation of accountable care organizations (ACOs). It addresses many of the most significant objections raised by stakeholders earlier this year and in so doing creates a payment model which could accelerate real change in the way healthcare services are paid for and delivered.
Many provider organizations will now take a serious look at whether and how they might go about establishing a MSSP ACO. Among some of the most significant features of the MSSP are the provisions; (i) allowing providers to form a MSSP ACO and take no downside risk in the initial three year contract period, (ii) switching to a prospective beneficiary identification process (with retrospective reconciliation), (iii) reducing the number of quality reporting measures from 65 to 33, (iv) making available patient identifiable claims data generated under Parts A, B and D, (v) establishing more flexible governance requirements, and (vi) changing the fraud and abuse and antitrust rules to reduce the legal risks associated with forming and operating a MSSP ACO.
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Two features of the Final Rule are especially interesting. First, the Final Rule signals a fundamental shift in the way the government looks to advance the use of Health IT to support its cost efficiency and care coordination goals. Under the Health Information Technology for Economic and Clinical Health (HITECH) Act, significant federal dollars under the meaningful use program were targeted toward paying hospital, physicians and other providers for use of certified electronic health record technology and for reporting from those records to the federal government a standardized set of functional and quality measures. Many viewed this approach as operationally burdensome and overly prescriptive, forcing providers to use particular technologies in ways that may or may not advance their overall mission and goals.
The approach to advancing the use of Health IT in the Final Rule differs from past efforts. CMS has replaced the requirement that 50 percent of the primary care physicians in a MSSP ACO be meaningful EHR users by the second year of an ACO contract with a scoring bonus for those who use EHRs in their quality reporting programs. Even more significantly, CMS acknowledges health information exchange — not just EHR use — as a primary driver for meeting the efficiency and care coordination goals of the program.
The CMS approach is to encourage the need for health information exchange, while avoiding overly prescriptive requirements. In a response to a question on the use of health information exchange, CMS notes: “[h]ealth information exchanges are of the utmost importance for both effective coordination of care activities and the success of the Shared Savings Program. We understand that there will be variable ability among ACOs to adopt the appropriate health information exchange technologies, but underscore the importance of robust health information exchange tools in effective care coordination.”
The removal of the meaningful use requirement suggests CMS is more interested in allowing the market to focus on what needs to be accomplished to meet clinical quality, care coordination, cost reduction, and patient engagement goals, rather than in specifically instructing stakeholders on how to accomplish these goals. It is likely that this change in direction will support the continued movement of providers toward thinner, lighter applications and solutions that focus on critical ACO functions such as registries, care management, decision support, and “private” information exchange capabilities. Ultimately, ACOs will need to focus less on including participants that are meaningful users of EHRs, and more on participants that are willing to use tools and services that support an ACO’s goals.
Second, the Final Rule intelligently advances a framework that makes it possible for providers to develop and operate the same care management and coordination programs, for multiple payers. Both the fraud and abuse and antitrust policies being promulgated alongside the Final Rule open the door to the development of multi-payer ACO initiatives. For example, a final statement issued by the Department of Justice and the Federal Trade Commission eliminates mandatory antitrust review for arrangements that have a market share of greater than 50 percent and confirms that an ACO participating in a Medicare Shared Savings Program will be deemed clinically integrated with respect to commercial arrangements utilizing the same infrastructure.
Similarly, in the Interim Final Rule relating to the Federal fraud and abuse laws CMS and the HHS Office of the Inspector General significantly broaden the waivers available to MSSP ACOs to cover not only shared savings, but also investments in infrastructure and operations as well as incentives to encourage beneficiaries to access preventive care and comply with treatment regimens. Significantly, the expanded waiver authority applies to investments that advance goals of both the Medicare Shared Saving Program and commercial arrangements, creating a much bigger opportunity for multi-payer ACO solutions involving commercial carriers and Medicaid state agencies.
[Related: Will the new ACO regs entice you to take another look? Come vote in our reader poll.]
By architecting the Medicare Shared Saving Program with an organizational and business structure that is designed to extend beyond the Medicare program, CMS lays the foundation for genuine reform of the delivery system. One can easily imagine the framework adopted in the MSSP as providing precedent not only in the commercial arena, but also providing a roadmap for State look-alike statutes that advance similar incentives and waivers for providers desiring to restructure their operations in ways that meet the underlying objectives of the MSSP. To date, 12 states have passed ACO statutes. If state law development parallels Federal law, the ACO business proposition may very well become the powerful change agent the Administration hopes it will be.
Bill Bernstein is chairman of the healthcare division at law firm Manatt, Phelps & Phillips, which works with states and providers on health IT and related public policy issues.
