ACO Alerts: Antitrust & Exempt-Status Implications

Healthcare providers, he says, should pay particular attention to two areas:

1. The competitive effect of ACO contractual agreements.
2. 2) The impact of these contractual agreements on the cost of healthcare.

To assess the competitive effect of ACO agreements, the Centers for Medicaid & Medicare Services will provide the FTC and DOJ with aggregate claims data on allowed charges and fee-for-service payments. In their joint statement, the agencies wrote that they would use the data “together with their traditional enforcement tools, to evaluate competitive concerns about an ACO’s formation or conduct and will take whatever enforcement action may be appropriate.”

Moreover, the FTC and DOJ will pay particular attention to the dominant participant in a healthcare market, defined as an organization with over 50% market share. If this participant offers a primary service to an area in which very few or no other providers do, then that organization must remain a non-exclusive service provider within the ACO. That primary service provider must be permitted to contract with other care delivery organizations.

Dr. David Spahlinger, internist and senior associate dean at the University of Michigan Medical School, says the revised ACO regulation provides more flexibility for partnering, “but it’s still a lot stiffer than what we’ve had for years. We’ve had hospitals with 80% of the market share merge and no one paid attention, and there has been a minimal amount of review in the past. This is a new day.”