PPACA Impact and Opportunities : Health Care Lawyer & Attorney : Epstein Becker Green Law Firm : Insurance & Costs : Health Reform Musings Blog

by Douglas A. Hastings 

According to the Administrator of the Centers for Medicare & Medicaid Services (“CMS”), Dr. Donald M. Berwick, the long-awaited proposed regulations implementing the Medicare Shared Savings Program should be out soon. Given the incredible proliferation of policy, business, and legal thinking about accountable care organizations (“ACOs”) that has taken place since the passage of the Affordable Care Act (“ACA”) less than a year ago, CMS’s initial effort to describe a program of payment and delivery reform built around the ACO “model” will contribute importantly to the national dialogue on accountable care and will give providers a first look at CMS’s detailed requirements for the Medicare Shared Savings Program.

What, then, are some of the key issues that the regulations are likely to address by which we can evaluate the Medicare Shared Savings Program’s potential progress on the road to accountable care? The way CMS further defines ACOs and structures the Medicare Shared Savings Program, including possible risk sharing features, will not only ultimately determine the success of the Medicare ACO program but will also no doubt affect the shape of burgeoning ACO efforts at the state level for Medicaid programs and in the commercial market.

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As the health care world awaits the Medicare Shared Savings Program regulations expected to be issued soon by CMS, below is a wish list for key attributes that I hope the regulations evidence:

1. Flexibility. 

 "Transforming health care everywhere starts with transforming it somewhere." I hope that CMS takes Atul Gawande's advice and avoids being too proscriptive in launching the Share Savings Program. To me, the biggest risk to the program is being deemed a failure for having gone down too narrow a path that turns out to be unsuccessful.

Useful approaches have been suggested for tiering ACOs and providing for related payment methodologies based on levels of ACO capability. If some form of risk sharing model is going to be included along with simple share savings, let's not at the outset go so far along the risk axis that many start-up but promising ACOs would be excluded. Flexibility will encourage positive experimentation and inclusiveness in the interest of learning over time.

2. Discipline.

 At the same time, the ACO regulations need to have teeth. Despite the ongoing policy debates about how to measure quality and value, we know enough now for CMS to provide strong minimum requirements that will separate ACOs that show real promise from those that do not. In order to qualify for bonus or risk-based payments, ACOs will need to demonstrate both the current capability and the future capacity to further the triple aim goals of accountable care--improved patient outcomes, patient satisfaction and cost efficiency.

Such evidence will then justify appropriate recognition and protection under the fraud and abuse laws and antitrust laws, among others. And the discipline must be ongoing and progressive--continued qualification and continued improvement. Failure to maintain such qualification must have consequences--both financial and legal.

3. Simplicity.

One of the risk factors in the success of the Medicare Shared Savings Program is that it will be too complicated to implement effectively. There are a million ideas out there about ACOs--regarding structure and governance, assigning beneficiaries, what measures to use, how to allocate savings, etc.

Failure to construct a manageable pathway and an understandable set of rules at the outset--for diverse providers to follow and for consumers to understand and embrace--will severely threaten the ultimate success of the program. It would be easy to try to do too much too fast due to the pressure to "bend the cost curve," among others. I hope that CMS keeps it simple, straightforward and understandable with achievable program goals.

4. Patience.

Even if the regulations evidence flexibility, discipline and simplicity, we will need to be patient. "We" means CMS, Congress, private payers, providers and consumers. This program is one component of a broader set of ideas relating to health care payment and delivery reform in both public and commercial settings. The overall goal is to achieve the triple aim stated above--or as CMS Administrator Berwick often puts it, "better care, better health and lower costs"--through a variety of means and over time.

The Affordable Care Act in its entirety encompasses new quality reporting requirements, value-based purchasing programs, bundling pilots, gainsharing demonstrations, readmissions penalties and other methods of "testing, testing." Not to mention the efforts of the new Center for Medicare and Medicaid Innovation. If the Medicare Shared Savings Program tries to do too much too quickly on its own and the goals are not measured and paced, it inevitably will be judged unfairly and will not make as helpful a contribution as it otherwise might.

5. Harmony.

Another word I might have chosen here is coordination, but coordination is a means to harmonizing the activities and impact of the relevant federal agencies involved in ACO implementation, the various payment and delivery reform components of the Affordable Care Act and the public and private sector initiatives in this arena. Is such harmony too much to hope for? Perhaps, but it should be a goal and it should be achievable over time.

CMS, OIG, FTC and DOJ already have evidenced coordination in the days before and following their October 5, 2010 public workshop on the antitrust issues and fraud and abuse issues related to ACOs. Coordinated guidance is reasonable to expect. The ACA explicitly allows for the coordination of ideas and best practices in accountable care efforts in connection with both governmental and commercial health care payment practices. It certainly is within the power of Secretary Sebelius and Administrator Berwick to harmonize the implementation of Sections 3021, 3022 and 3023 of the ACA, along with the many other provisions that relate to achieving accountable care.

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The ACO regulations should be out soon. They of course will constitute a start, not a finish. There will be much more work to be done. But my wish--and I am hopeful--is that they lay out a constructive and manageable pathway that fits with others in helping to advance the triple aim.

Doug Hastings

by George B. Breen, Carrie Valiant, Emily E. Bajcsi, Anjali N.C. Downs, and Amy F. Lerman

On February 2, 2011, the Centers for Medicare and Medicaid Services ("CMS") published new rules ("Final Rule") authorized by the Affordable Care Act ("ACA") creating a vigorous screening process for new and existing Medicare, Medicaid and the Children's Health Insurance Program ("CHIP") providers and suppliers; giving CMS authority to temporarily stop enrollment of new providers and suppliers; expanding the ability of CMS and States to temporarily suspend payments to providers and suppliers; establishing requirements for States to terminate providers from the Medicaid and CHIP programs; and adding several other enrollment-related provisions. Generally, the new rules are effective March 25, 2011.

Publication of the Final Rule follows the recent announcement that the federal government recovered more than $4 billion in FY 2010 from health care fraud prosecutions and settlements – the largest annual amount ever recovered in health care fraud cases. Significantly, the 2010 recoveries from civil health care matters brought under the False Claims Act were more than $2.5 billion, reportedly the largest in the history of the Department of Justice ("DOJ"). These results, and the Final Rule, are further evidence of the increased focus the government will place on enforcement efforts in 2011 and beyond.

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