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ACO Terms to Know Mark Taylor
Earlier this year, the Obama administration released its long-anticipated proposed rules governing accountable care organizations, a mechanism that will pay providers a share of savings based on their ability to lower costs while meeting quality metrics. Navigating these new rules requires the mastery of key terms.  The following glossary of ACO terms was extracted from Health Leaders Media Impact Analysis.  Click here to access the full report.  The Paperwork Reduction Act of 1980 The proposed ACO rules specifically say that the PRA, which strives to minimize the paperwork burden resulting from the collection of information by or for the federal government, would not apply to ACOs. Safety Zone Think safe harbor. This is the promise that federal antitrust agencies, “absent extraordinary circumstances” will not challenge the eligibility of an entity that meets other ACO criteria if its provider participants fall into this safety zone. To do so, they must have a combined share of 30% or less of each common service in an ACO participant’s primary service area. The zone is extended for ACO participants who have between 31% to 50% share of a common service area, “if it avoids specified conduct.” A greater than 50% share, however, constitutes “a valuable indication of an ACO’s potential for competitive harm.” There are exceptions for providers in Rural Service Areas. Primary Service Area This is defined as the lowest number of contiguous postal ZIP codes from which the ACO participant draws at least 75% of its patients for that service. Retrospective Assignment To eliminate the possibility that an ACO would pick the healthiest, easiest-to-manage patients, groups of 5,000 beneficiaries would be retrospectively assigned to each ACO by CMS. Here’s CMS’ explanation from page 114 of the regulations: “One reason for this is that we believe that the ACO should be evaluated on the quality and cost of care furnished to those beneficiaries who actually choose to receive care from ACO participants during the course of each performance year. Another reason for retrospective assignment is to encourage the ACO to redesign its care processes for all Medicare FFS beneficiaries, not just for the subset of beneficiaries upon whom the ACO is being evaluated.” Procompetitive ACOs that are procompetitive are likely to be approved and not endure any further scrutiny from the DoJ or the FTC. Likewise, anticompetitive ACOs will not be approved, or will subsequently face review. Rule of Reason This refers to the guidelines that the DoJ and the FTC will use to ensure procompetitiveness. In its statement of antitrust enforcement policy, they explain that “antitrust laws treat naked price-fixing and market-allocation agreements among competitors as per se illegal. Joint price agreements among competing health care providers are evaluated under the rule of reason, however, if the providers are financially or clinically integrated and the agreement is reasonably necessary to accomplish the procompetitive benefits of the integration.” TIN Each ACO will have to have a Taxpayer Identification Number, as that number signifies who would be paid shared savings. Dominant Provider Limitation The FTC and DoJ would apply this limitation “to any ACO that includes a participant with a greater than 50% share in its PSA of any service that no other ACO participant provides to patients in that PSA. Under these conditions, the ACO participant (a “dominant provider”) must be non-exclusive to the ACO to fall within the safety zone. In addition, to fall within the safety zone, an ACO with a dominant provider cannot require a commercial payer to contract exclusively with the ACO or otherwise restrict a commercial payer’s ability to contract or deal with other ACOs or provider networks.” Mandatory Antitrust Review An ACO that does not qualify for the rural exception is subjected to a mandatory federal scrutiny if its share exceeds 50% for any common service that two or more independent ACO participants provide to patients in the same PSA. One exception to mandatory antitrust review could be employed if the ACO can supply CMS with a letter from either the DoJ or the FTC “stating that the reviewing Agency has no present intention to challenge or recommend challenging the ACO under the antitrust laws.” Group Practice Reporting Option The GPRO is the method by which CMS proposes to calculate results for the first year of the program. The GPRO is similar to the Physician Quality Reporting System. CMS says the GPRO tool is a mechanism by which beneficiaries’ lab results and other clinical information can be reported to CMS for determining shared savings. Measures reported under the GPRO must consist of at least 411 assigned beneficiaries per measure set/domain, and if the pool of eligible beneficiaries is less than 411 for any measure set or domain, then the ACO will have to report on 100% of all assigned beneficiaries. Domain This is how CMS categorizes the 65 quality metrics whose scores will be basis for determining shared savings of up to 60%, or 65% if the ACO includes federally qualified health centers or rural health centers. There are five domains: 1 Patient or caregiver experience includes seven measures. 2 Care coordination includes 16 measures. 3 Patient safety includes two measures. 4 Preventive health includes nine measures. 5 At-risk population/frail elderly health includes 31 measures. This domain focuses on six categories of health conditions or status: diabetes, heart failure, coronary artery disease, hypertension, chronic obstructive pulmonary disorder, and frail elderly. ACO Professional This is a physician or osteopath, physician assistant, nurse practitioner, or clinical nurse specialist and not limited to those dedicated to primary care. Eligibility The proposed rule says that the following groups are eligible to participate in an ACO: • ACO professionals in group practice arrangements • Networks of individual practices of ACO professionals • Partnerships or joint venture arrangements between hospitals and ACO professionals • Hospitals employing ACO professionals • Other groups of providers determined to be appropriate by the Secretary of Health and Human Services.  

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