Sebelius announces 89 new ACOs

Posted on July 9, 2012 | No Comments

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U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced yesterday that as of July 1, 2012, 89 new Accountable Care Organizations (ACOs) began serving 1.2 million people with Medicare in 40 states and Washington, D.C. ACOs are organizations formed by groups of doctors and other health care providers that have agreed to work together to coordinate care for people with Medicare. These 89 new ACOs have entered into agreements with CMS, taking responsibility for the quality of care they provide to people with Medicare in return for the opportunity to share in savings realized through high-quality, well-coordinated care. Federal savings from this initiative are estimated to be up to $940 million over four years.

The 89 ACOs announced today bring the total number of organizations participating in Medicare shared savings initiatives to 154, including the 32 ACOs participating in the testing of the Pioneer ACO Model by CMS’s Center for Medicare and Medicaid Innovation (Innovation Center) announced last December, and six Physician Group Practice Transition Demonstration organizations that started in January 2011. For 2012, CMS has established 33 quality measures relating to care coordination and patient safety, appropriate use of preventive health services, improved care for at-risk populations, and patient and caregiver experience of care.

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In a field report published yesterday, the Commonwealth Fund discusses the progress made by accountable care organizations (ACOs) in improving health care quality and efficiency. ACOs, established by the Affordable Care Act (ACA) as a Medicare delivery system option, are designed to systematically improve health care delivery and mitigate cost increases by forming contractual relationships between physicians and payers. This report details the successes and challenges experienced by seven hospital-physician groups that are considered early-adapters of the ACO model. These entities are involved, or will soon be involved, in risk-sharing arrangements with public and private payers. Representatives from the featured ACOs discuss their strategies for integrating clinicians, managing practices, designing incentives, and sharing rewards. The goal of this report is to educate providers in methods that promote partnership and success in ACOs.
The Kaiser Family Foundation reviews a number of state initiatives related to Medicaid Accountable Care Organizations (ACOs) in a recently published report. Findings indicate that most Medicaid ACOs are currently at an early stage of development. The structure of the Medicaid ACO initiatives is influenced by individual states’ history and experience with managed care, other existing care delivery arrangements within Medicaid, and the challenges inherent in serving low-income and chronically ill populations. Medicaid ACOs directly engage providers and provider communities in improving care and contain costs. ACOs are provider-run organizations in which the participating providers are collectively responsible for the care of an enrolled population. Under an ACO, the managing providers may share in any savings associated with improvements in the quality and efficiency of the care they provide. Several states are rolling out ACO initiatives with the goal of improving Medicaid care.
A recent analysis, funded by the RCHN Community Health Foundation and authored by researchers from the Geiger Gibson Program in Community Health Policy at the George Washington University, examines Medicare Accountable Care Organizations (ACOs) and their effect on community health center patients. The analysis finds that rules requiring ACO services to be provided by a physician only, may effectively exclude from ACO participation certain underserved populations who use non-physician providers for their primary care. Sara Rosenbaum, lead author of the study, is a frequent contributor to HealthReformGPS.
The U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that health care providers have formed 106 new Accountable Care Organizations (ACOs) in Medicare, covering as many as 4 million Medicare beneficiaries. The new ACOs include a practices from 47 states in total, including the Billings Clinic in Montana; Cedars-Sinai Accountable Care in Louisiana; the Marshfield Clinic in Wisconsin; Geisinger Health System in New York and Pennsylvania; and UCLA Health System. About half of all ACOs now are physician-led groups serving fewer than 10,000 beneficiaries, and 20 percent serve rural or low-income areas. Since passage of the Affordable Care Act, more than 250 Accountable Care Organizations have been established. ACOs share with Medicare any savings generated from lowering the growth in health care costs, while meeting standards for quality of care. ACOs must meet quality standards to ensure that savings are achieved through improving care coordination and providing care that is appropriate, safe, and timely. The Centers for Medicare & Medicaid Services (CMS) has established 33 quality measures on care coordination and patient safety, appropriate use of preventive health services, improved care for at-risk populations, and patient and caregiver experience of care. Federal savings from this initiative are estimated to be up to $940 million over four years.
The Centers for Medicare & Medicaid Services (CMS) released frequently asked questions (FAQs) regarding the Medicare Shared Savings Program, a program established by the Affordable Care Act (ACA). Specifically, the guidance addresses Accountable Care Organizations (ACOs). ACOs are formed by providers that have agreed to work together to better coordinate patient care. Information included in the FAQs include general facts regarding ACOs, the ACO participant list form CMS-588 electronic funds transfer, and governing body background. On July 9, CMS announced 89 new ACOs had been selected to participate in the second wave of the Medicare Shared Savings Program.
Today, the U.S. Department of Health and Human Service (HHS) named 32 health care organizations that will participate in the Pioneer Accountable Care Organization Model. The goal of the new ACO Model is to encourage providers, hospitals, specialists, and caregivers to provide more coordinated care, which could save $1.1 billion over a five year period, HHS projects. The Centers for Medicare & Medicaid Services (CMS) Innovation Center is spearheading this initiative and will reward groups that have formed ACOs based on improvements in health of their Medicare patients and their ability to lower health care costs. Under the Pioneer ACO Model, the 32 selected health care organizations will test the effectiveness of several innovative payment models. The goal of the Pioneer ACO model is to provide better care for beneficiaries, improved coordination with private payers, a reduction Medicare cost growth, and rewards for health care providers that deliver high-quality care. The 32 selected Pioneer ACOs represent urban and rural organizations from various geographic regions of the country, covering 18 states and 860,000 Medicare beneficiaries.
The Centers for Medicare and Medicaid Services (CMS) released the much anticipated Accountable Care Organization (ACO) final rule, implementing section 3022 of the Affordable Care Act (ACA), which contains provisions relating to Medicare payments to providers of services and suppliers participating in ACOs under the Medicare Shared Savings Program. The rule on Medicare ACOs relaxes eligibility requirements for doctors and hospitals to participate by halving the number of performance measurements (65 to 33), removing the electronic medical records (EMR) requirement, and eliminating some financial risks. CMS also extended the deadline for ACO applications through 2012. As enticement to rural doctors and physician-owned practices, CMS said it would dedicate $170 million to said providers to start ACOs. Regulators estimate that between 50 and 270 ACOs will be established in the next 3 years, which will affect the care of 4% of Medicare beneficiaries. Multiple federal agencies also released rules and guidance on fraud & abuse and antitrust issues related to ACOs. The HHS Office of Inspector General (OIG) issued an interim final rule (IFR) on the waiver of certain fraud and abuse provisions and the Department of Justice (DOJ) issued a statement on health care antitrust enforcement policies. To read more about ACOs, click here. For the ACO final rule fact sheet, click here.
The Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS) have announced that the Center for Medicare and Medicaid Innovation (Innovation Center) will support a new type of Accountable Care Organization, called the Pioneer ACO Model. This type of ACO is designed to work in conjunction with both public and private payers and is estimated by the Medicare Chief Actuary to save up to $430 million over 3 years because of better care management and coordination. “The Pioneer Model is an opportunity for those organizations that have already adopted significant care coordination processes to move further and faster into seamless, coordinated care by utilizing alternative payment mechanisms,” said Richard Gilfillan, M.D., director of the Innovation Center. CMS will accept applications for Pioneer ACOs through July 18, 2011.
While a primary aim of the Affordable Care Act (ACA) was to increase access to affordable health insurance coverage, a critical, although less publicized, component of the law is a series of provisions designed to improve health care quality and efficiency and to advance the concept of “value-based purchasing.” The Agency for Health Care Research and Quality (AHRQ) defines the concept of value-based purchasing as holding “providers of health care accountable for both the cost and quality of care.” AHRQ notes that “value-based purchasing brings together information on the quality of health care, including patient outcomes and health status, with data on the dollar outlays going towards health. It focuses on managing the use of the health care system to reduce inappropriate care and to identify and reward the best-performing providers. This strategy can be contrasted with more limited efforts to negotiate price discounts, which reduce costs but do little to ensure that quality of care is improved.”
An earlier Implementation Brief provided an overview of the Medicare Shared Savings Program (MSSP) for Accountable Care Organizations (ACOs), which was established by §3022 of the Affordable Care Act (ACA) by adding §1899 to the Social Security Act. On April 7, 2011, the federal Centers for Medicare and Medicaid Services (CMS) published a proposed rule implementing the MSSP. This proposed rule was accompanied by several additional policy documents: