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ACO Rules Receive Guarded, Mixed Reviews

John Commins, for HealthLeaders Media, April 4, 2011

The Obama Administration has said that ACOs could save Medicare as much as $960 million over three years. Before the proposed rule is finalized, however, the Centers for Medicare & Medicaid Services will review all comments from the public and may make changes to its proposals based on those comments, the Department of Health and Human Services said.

HHS Secretary Kathleen Sebelius expressed confidence that ACOs would put patients and their doctors “in control” of their own healthcare. “For too long, it has been too difficult for healthcare providers to work together to coordinate and improve the care their patients receive,” Sebelius said. “That has real consequences: patients have gaps in their care, receive duplicative care, or are at increased risk of suffering from medical mistakes. Accountable care organizations will improve coordination and communication among doctors and hospitals, improve the quality of the care their patients receive, and help lower costs.”

The Medicare Shared Savings Program initiated under the Affordable Care Act will reward ACOs that lower healthcare costs while meeting performance standards on quality of care and patients’ need.

Under the proposal, ACOs – teams of doctors, hospitals, and other healthcare providers and suppliers working together – would coordinate care for patients with Medicare. To share in savings, ACOs would meet quality standards in five key areas:

  1. Patient/caregiver care experiences
  2. Care coordination
  3. Patient safety
  4. Preventive health
  5. At-risk population/frail elderly health.

The proposed rules also include protections to ensure patients do not have their care choices limited by an ACO, HHS said.

If ACOs save money by improving access to primary care so that patients can avoid a trip to the emergency room, for example, the ACO can share in those savings with Medicare. ACOs that do not meet quality standards cannot share in program savings, and over time, those who do not generate savings can be held accountable.

“An ACO will be rewarded for providing better care and investing in the health and lives of patients,” said Donald M. Berwick, MD, CMS Administrator. “ACOs are not just a new way to pay for care but a new model for the organization and delivery of care.”


John Commins is a senior editor with HealthLeaders Media.

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