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ACO Final Ruling: Let the Games Begin

On October 20, 2011, the Centers for Medicare and Medicaid Services (CMS), an agency within the Department of Health and Human Services (HHS), released its final rule for the Medicare Shared Savings Program, which involves the establishment of Accountable Care Organizations (ACO) and is set to take effect January 1, 2012. 

The Initial ACO Ruling Generated Significant Criticism

The initial ruling on March 31, 2011 by CMS generated a tremendous amount of criticism from various healthcare providers and organizations who found it to be overly complicated, risky, and unrealistic to implement. The final ruling seems to be a little bit more user-friendly after more than 1,300 comments were submitted to CMS after the release of the proposed ACO rule. “The Medicare agency listened carefully to the concerns before finalizing the rule”, said previous CMS Administrator Donald M. Berwick, MD, “for example, the final rule will increase incentives and streamline the shared savings program, extending the benefits of the new program to a broader range of beneficiaries.” 

The Second ACO Ruling Eased Some ACO Requirements

ACOs will still have to make a three-year commitment to care for a group of at least 5,000 Medicare beneficiaries under the program. However, a few important aspects of an ACO have been modified in the final rule. Here are a few important changes from the proposed rule to the final rule as well as provider and healthcare organization responses.

This paper discusses final rule changes applying to:

  • Reduced required quality measures from 65-to 33
  • The likelihood most ACOs will go immediately to Track 2
  • Continued participation despite net losses
  • Eliminated EHR requirements for reporting quality measures and general use
  • Sharing beneficiary claims data
  • The advance payments model

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