Federal officials today released long-awaited draft regulations that will govern the way Affordable Care Organizations are paid for treating Medicare patients.
Savings from improved and better-coordinated patient care would be shared with doctors and hospitals under guidelines put forth as part of federal health reform.
Officials estimated net savings to the Medicare program of between $510 million and $960 million over three years once the guidelines are official.
ACOs, as they are known, are intended to encourage integrated or better coordinated patient care, by weaning providers from the fee-for-service approach to practicing medicine.
An Accountable Care Organization assumes responsibility for coordinating a broad continuum of care designed to improve or maintain the health of a large number of patients. Because the care is closely coordinated and stresses prevention and chronic-disease management, it is expected to reduce emergency-room visits and return hospitalizations, which eventually would reduce costs.
Under the proposed guidelines, Medicare would continue to pay ACO providers who have at least 5,000 patients on a fee-for-service basis. But if the ACO spent less money than projected by the Centers for Medicare and Medicaid Services, it would qualify to share in the savings.
How much of the savings an ACO could collect would depend on how well it met quality standards, such as reducing infections or hospital readmissions. If an ACO spent more money than projected, it could lose money.
U.S. Secretary of Health and Human Services Kathleen Sebelius said the new rules stemming from the Affordable Care Act would help remedy some of the problems with the way the health care system currently operates with payments pegged to procedures as opposed to results.
“Hospitals that provide high quality follow-up care actually make less money than hospitals whose patients are back a week later,” Sebelius said, noting that one in five Medicare patients discharged by hospitals are back in 30 days, “in many cases because they failed to receive correct follow-up care.”
ACOs are intended to bring together doctors, hospitals and other providers in a team-like approach to treating patients.
Also speaking at a Thursday morning press conference was Dr. Donald Berwick, chief of the Centers for Medicare and Medicaid Services or CMS.
Berwick said ACOs would make the health system less fragmented.
Currently, he said, “patients wander from one specialisit to another without sufficient coordination of care. We can do much better.”
Officials said CMS last year solicited and received about 400 comments that it considered while developing the proposed rules, which have been delayed for months.
The new rules will not limit what providers a Medicare beneficiary can see, officials said, and providers who are part of an ACO must inform the patients.
Federal officials also posted online a fact sheet about ACOs.
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