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Get Ready Now for 2014 Medicare ACO Program

Julian D. "Bo" Bobbitt, Jr.
Internal Medicine News
04.05.2013

The Centers for Medicare and Medicaid Services has just announced key dates for the 2014 Medicare Shared Savings Program application cycle – and although the upcoming Jan. 1, 2014, start date for the MSSP seems far off, physicians should start organizing now.

Physician interest in participating is mounting, as physician-led accountable care organizations are emerging as leaders in improving quality while eradicating waste. In fact, there are now more physician-run ACOs than any other model (see chart below).

Physicians see opportunity

The MSSP has embraced the accountable care concept to improve the quality of care for Medicare fee-for-service beneficiaries. Eligible providers and suppliers may participate in the MSSP by creating or participating in an ACO. The MSSP rewards ACOs that lower their rate of growth in health care costs while meeting quality performance standards.

On Jan. 10, 2013, the Centers for Medicare and Medicaid Services (CMS) announced that 106 new organizations were selected to participate in the program. That’s in addition to the 87 ACOs approved in July 2012 and the 27 selected in April 2012 – bringing the total to 220 ACOs selected to participate in the MSSP. Early evidence indicates that these ACOs are decreasing costs while improving clinical outcomes.

For many of those ACOs, Medicare will be just the beginning. Private insurers such as Aetna, UnitedHealth Group, Humana, Cigna, and most Blue Cross plans are contracting with ACOs to care for more patients. Many state Medicaid programs have moved or are considering moving to accountable care.

These multiple streams of shared savings will be generated through the same ACO infrastructure needed for the MSSP, encouraging more physician-owned ACOs to form.

With the rise of ACOs, "providers are doing things in a positive way rather than a reactive way. We are seeing the beginnings of a tsunami," noted Dr. Michael Cryer, national medical director at employee benefits consultancy Aon Hewitt, in a New York Times article (Small-picture approach flips medical economics, March 12, 2012).

According to a recent study by consulting firm Oliver Wyman entitled "The ACO Surprise," roughly 10% of the U.S. population, or from 25 million to 31 million patients, are being served by ACOs. "Successful ACOs won’t just siphon patients away from traditional providers. They will change the rules of the game," the report’s authors conclude.

Don’t miss these 2013 deadlines

CMS has just released its 2013 application cycle for 2014 (see table). The time to act is now. It will take time to understand ACOs and enlist a critical mass of informed and committed primary care providers. Though the notice of intent ("NOI") is not binding, failure to file in May is binding – you are barred from applying. Likewise, you must obtain your user ID by May 31.

The application is not hard, but it basically reflects your ACO game plan. You must be organized, have a focused care plan, and complete the application by the end of July – much earlier than last year’s deadline.

Bottom line: Do not let the start date lull you into procrastination.

Let’s have a closer look at some of the things that must be covered in the application. In addition to a culture of teamwork, patient engagement, and alignment of financial incentives, which are chief among the eight essential elements necessary for a successful ACO (The essential elements of an ACO), Internal Medicine News, Oct. 1, 2012, p. 38), the MSSP application requires:

  • Compliance with the required definitions of "ACO applicant" and "participant."
  • A certification that the ACO, its ACO-provider participants, and its ACO providers/suppliers have agreed to become accountable for the quality, cost, and overall care of the Medicare fee-for-service beneficiaries assigned to the ACO.
  • Establishment of a governing body.
  • Implementation of a comprehensive compliance plan.
  • Execution of an ACO Participation Agreement.

In addition, certain organizational milestones should be reached in advance of the application. In particular, planning for a successful ACO requires identification of a physician-champion, completion of a feasibility analysis, implementation of sufficient information technology, and internal reporting on quality and cost metrics. As in any entrepreneurial pursuit, timing is critical, and delay equates to lost potential.

Given that primary care providers are the only providers mandated for inclusion in the MSSP, it is apparent that CMS expects primary care to drive ACO value via prevention and wellness; chronic disease management; care transitions and navigation; reduced hospitalizations; and multispecialty care coordination of complex patients.

ACOs, in one form or another, are sure to be permanent fixtures in American health care, as the nation’s economy and its residents eagerly await the benefits stemming from primary care–driven innovation.

Opportunity knocks – get going!

This article appears courtesy of Internal Medicine NewsBo Bobbitt is the author of Internal Medicine News "ACO Insider" column.

Bo has many years of experience assisting physicians form integrated delivery systems. He has spoken and written nationally to primary care physicians on the strategies and practicalities of forming or joining ACOs. This article is meant to be educational and does not constitute legal advice. For additional information, please contact Bo Bobbitt.

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