CMS Issues Proposed ACO Rule to Address Industry Concerns and Encourage Participation in Alternative Risk-Based ACO Models

On Monday, December 1, 2014, the Centers for Medicare & Medicaid Services (“CMS”) issued a Proposed Rule with several proposed changes to the regulations finalized in 2011 for Accountable Care Organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP).  According to CMS, the Proposed Rule is intended to reduce administrative burdens and improve program function and transparency for ACOs participating in the MSSP. There are currently 330 ACOs serving almost 5 million Medicare beneficiaries in 47 states.

According to CMS, the Proposed Rule is meant to improve the MSSP by placing a greater emphasis on primary care services and supporting transitions to performance-based risk arrangements.  The goal of the ACO program is to encourage doctors, hospitals and other healthcare providers to keep patients healthy and coordinate care when they are sick in order to reduce healthcare costs and improve outcomes. ACOs can share savings with Medicare when they deliver care more efficiently and meet or exceed performance benchmarks for quality care.

The CMS Proposed Rule specifically addresses the following nine areas: (1) data-sharing requirements; (2) requirements for ACO participant agreements, the ACO application process, and our review of applications; (3) identification and reporting of ACO participants and ACO providers/suppliers, including managing changes to the lists of ACO participants and ACO providers/suppliers; (4) eligibility requirements related to the ACO’s number of beneficiaries, required processes, the ACO’s legal structure and governing body, and its leadership and management structure; (5) modification to assignment methodology; (6) repayment mechanisms for ACOs in two-sided performance-based risk tracks; (7) alternative to encourage participation in risk-based models; (8) ACO public reporting and transparency; (9) the ACO termination process; and (10) the reconsideration review process.

The Proposed Rule is are expected to be in the Federal Register on December 8, 2014, and comments to the Proposed Rule may be submitted to CMS within sixty (60) days after publication of the Proposed Rule in the Federal Register.

A fact sheet with more information about the ACO Proposed Rule is available on the CMS website at:

A copy of the ACO Proposed Rule is available at:

Written by: Clay Countryman and Danielle Borel

Countryman, Clay headshot      Danielle Borel_headshot

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