April 11, 2012
By Lauren Gaffney and Daniel Kuninsky*
When the Patient Protection and Affordable Care Act of 2010 (PPACA) was signed into law, few of its provisions caused more excitement, debate, and speculation than the Medicare Shared Savings Program (MSSP) found in Section 3022. Under Section 3022, the Centers for Medicare & Medicaid Services (CMS) had fewer than twenty-one months to develop the MSSP—a program that arguably has the potential to transform the very essence of the healthcare delivery system in the United States. With the first MSSP accountable care organizations (ACOs) scheduled to go live on April 1, many in the industry have been eagerly awaiting the list of first-round ACO picks. That day has finally arrived.
On April 10, CMS announced that twenty-seven applicants have been chosen to be the first round of ACOs within the MSSP. According to CMS, this initial set of ACOs will cover approximately 375,000 beneficiaries across eighteen states. While most of the ACOs appear to be formed as limited liability companies, several are incorporated and one formed as a public service commission. And, while we now know the name and service area for each of the twenty-seven ACOs, we will need to stay tuned to fully understand the combination of providers that makes up each of these ACOs. For 2012, CMS has established thirty-three quality measures related to care coordination and patient safety, appropriate use of preventive health services, improved care for at-risk populations, and the patient and caregiver experience of care.
Starting April 1, this brings the overall number of healthcare entities participating in the MSSP to sixty-five, which includes the thirty-two Pioneer Model ACOs previously announced in December 2011, and six Physician Group Practice Transition Demonstration entities that formed in January 2011. CMS estimates that this brings the total number of beneficiaries receiving care in all Medicare shared savings initiatives to more than 1.1 million. CMS Acting Administrator Marilyn Tavenner commented, "We are encouraged by this strong start and confident that by the end of the year, we will have a robust program in place, benefitting millions of seniors and people with disabilities across the country."
The twenty-seven selected ACOs collectively include more than 10,000 physicians, ten hospitals, and thirteen smaller physician-driven organizations in both rural and urban areas. The models of each ACO for care coordination vary based on the population served in the various areas. CMS is currently reviewing more than 150 additional applications from ACOs applying to enter the program in July 2012. CMS also announced that five of the twenty-seven new ACOs are participating in the Advance Payment ACO Model. This subset of rural and physician-based ACOs will receive an advance payment of expected shared savings to assist with start-up costs, such as new staff or information technology systems. CMS is reviewing more than fifty applications for Advance Payments that would start in July.
*We would like to thank Lauren M. Gaffney, Esquire, and Daniel R. Kuninsky, Esquire (Bass Berry & Sims PLC, Nashville, TN), for providing this email alert.