Accountable Care Organizations (ACOs)

Accountable Care Organizations (ACOs)

ACO - Healthcare Provider Network

On March 31, 2011, the Centers for Medicare & Medicaid services (CMS) proposed new rules under the Affordable Care Act to help doctors, hospitals, and other health care providers better coordinate care for Medicare patients through Accountable Care Organizations (ACOs).  CMS has created incentives for the ACOs to coordinate patient care across care settings – including doctors’ offices, hospitals, and long-term facilities.  The Medicare Shared Savings Programs will reward ACOs based on lowering costs of providing healthcare services while meeting performance standards on quality of care.  Patient and provider participation in an ACO is voluntary.

Who are included in an ACO?

  • ACO professionals (i.e., physicians and hospitals) in group practice arrangements,
  • Network of individual practices of ACO professionals,
  • Partnerships of joint ventures arrangements between hospitals and other ACO professionals,
  • Hospitals employing ACO professionals.

How could providers participate?

Providers can participate in Medicare’s Shared Savings Program, providers must form or join an Accountable Care Organization (ACO) and apply to CMS. If accepted, ACOs would serve at least 5,000 Medicare patients and agree to participate in the program for 3 years.  Providers would continue to receive payment under Original Medicare fee-for-service (FFS) rules.

As part of the participation criteria, ACOs must establish a governing body representing ACO providers of services, supplier, and Medicare beneficiaries.

How would the Shared Savings work?

Medicare would continue to pay individual providers and suppliers as it currently does under the Original Medicare fee-for-service payment system.  In addition, CMS would develop a benchmark for each ACO against which its performance is measured to assess whether an ACO qualifies to receive shared savings, or be held accountable for losses.  The benchmark would be an estimate of what the total Medicare fee-for-service Parts A and B expenditures for ACO beneficiaries would otherwise have been in the absence of the ACO.

What are proposed quality measurements that CMS would be using?

CMS has proposed to measure quality of care by the ACOs using nationally recognized measures in 5 key areas:

  1. Patient experience;
  2. Care coordination;
  3. Patient safety;
  4. Preventive health; and
  5. At-risk population/frail elderly health.

Effective date of ACOs?

January 1, 2012.

2 Responses to “Accountable Care Organizations (ACOs)”

  1. Pay attention when your hear “ACO” or “Accountable Care Organization” « quinnscommentary Says:

    […] Accountable Care Organizations (ACOs) ( […]

  2. Managing Risk in Health Care | Goel Insights Says:

    […] Accountable Care Organizations (ACOs) ( […]

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