Major Health Care Players Take Issue With ACO Rule

Despite generally supporting the concept of the accountable care organization (ACO) health care model introduced under last year's health reform law, several major physician groups and medical centers have weighed in with serious concerns about the March 31 proposed rule for ACOs issued by the Centers for Medicare and Medicaid Services (CMS).

In comments submitted in early June, then AMA President Cecil Wilson, M.D., praised the "potential" of the ACO model to reduce costs and improve access to quality care but urged CMS "to make numerous revisions and to issue an interim final rule that allows the flexibility to adapt as needed."

Among the AMA's suggestions are modifying the proposed payment and risk structure of ACOs to encourage participation by physicians in all practice sizes, assigning patients to ACOs based on voluntary agreements, and allowing physicians to know which patients are participating in their ACO.

The proposed rule defines an ACO as a coordinated, patient-centered group of providers and service suppliers. Under the Medicare Shared Savings Program to be introduced next year, ACOs that help lower health care costs by meeting the program's quality-performance standards would be eligible to receive a share of any savings they generate. ACOs would also be required to repay Medicare for a portion of any losses they incur.

While most of the comments on the proposed rule praise the concept and intention of the ACO model, the criticisms and recommendations for change tend to echo the AMA's. In a 10-page letter to CMS Administrator Donald Berwick, M.D., the American College of Physicians, for example, voiced concern that the requirements outlined by CMS for obtaining ACO status "set too high of a bar for participation by many internal medicine physicians, especially [those] who practice in smaller, independent physician practices."

Similarly, APA's own nine-page letter to Berwick about how ACOs will impact psychiatrists calls for clarity in how ACO beneficiaries will be assigned and modifications to limit the program's risk structure, start-up and maintenance costs, and the number of performance measures on which ACOs would be required to report following their first year of existence (Psychiatric News, July 1).

Medical Centers Cite Major Concerns

Among the proposed rule's other critics are the Mayo Clinic and the Cleveland Clinic, both of which are typically regarded as exemplars of integrated care delivery. The two institutions joined 17 other organizations in addressing concerns with the proposed ACO regulations as part of the Healthcare Quality Coalition.

In a nine-page letter to CMS commenting on the ACO rule, Mayo President and CEO John Noseworthy, M.D., expressed the clinic's "serious concerns and reservations," specifically citing the proposal's requirements related to ACO governance, payment to providers, and the extent of quality measures that doctors and hospitals must monitor.

"In general, it is our sense that the rule is too complex in its structure and requirements for its purpose," Noseworthy said. "It is excessively detailed and restrictive in ways that will significantly reduce the number of interested groups. It creates a sense of mistrust toward providers in a manner that suggests CMS would not be a trustworthy and effective partner in the innovation that is necessary for us to really make progress in reform."

Cleveland Clinic CEO and President Delos Cosgrove, M.D., also outlined concerns with the proposed rule in a letter to Berwick. "Rather than providing a broad framework that focuses on results as the key criteria of success, the Proposed Rule is replete with... prescriptive requirements that have little to do with outcomes, and... many detailed governance and reporting requirements that create significant administrative burdens," Cosgrove said. "Further, we have concluded that the shared savings component... is structured in such a way that creates real uncertainty about whether applicants will be able to achieve success."

Consumer Advocates Back Strict Standards

Not all participants in the health care continuum are critical of the proposed rule, however. Consumer advocacy groups have largely praised the ACO program model as currently outlined in the federal rule. In fact, both Families USA and the Campaign for Better Care issued statements urging CMS to maintain the stringent quality-improvement standards and consumer protections contained in the proposed rule.