Final CMS Accountable Care Organization Regulations Provide ACOs More Flexibility

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Mike Cassidy

By Mike Cassidy

CMS has finally released the final rule for the Medicare Shared Savings Program, which is the program that establishes the rules for Accountable Care Organizations (ACOs).

The initial industry objections to the ACO concept and the proposed regulations was that it was so complicated, so limited and potentially so expensive that it would be impossible, or at least impractical, for any organization other than an all ready large and well established integrated delivery system to actually qualify as an ACO.  Interestingly enough, the entities that were already in existence and best suited for Medicare ACO qualification expressed little interest in the concept, presumably believing that they would qualify for the incentive programs and savings programs available from Medicare and other third party payors without the need of establishing an entity that qualified as an ACO within the requirements specified by CMS.  The final rules expect to relax those requirements and make ACOs more available and less risky, in an attempt to attract more potential participants.

Early predictions were that ACOs would be developed to cover less than 5% of the available Medicare fee for service beneficiaries.  It is too early to tell whether these relaxed regulations will change that outlook.

The ACO regulations are voluminous.  For those interested in establishing ACOs there is no substitute for actually parsing the regulations section by section.  However, for those interested in simply understanding what the changes have been, the Commonwealth Fund has published a well written and organized summary of the changes and a table identifying those changes, which is linked to this article.