Physical therapists are beginning to hear more about
Accountable Care Organizations (ACO’s). However, many
physical therapists probably don’t know what they are or how
they would affect them. And some physical therapists may not
even of heard of ACO’s.
The purpose of this article is to serve a brief primer to
introduce physical therapists to ACO’s and gain some
understanding about how they will affect their practice. The
information presented was acquired from the American
Physical Therapy Association Health Care Advocacy section.
The original documents can be found at
APTA.org.
ACO’s have been a hot topic on the health care
administrative front. Reams of information can be found
through social networks like LinkedIn, and on many
healthcare management web sites and blogs. Unless you are a
legislative geek, you may have missed many of these articles
or clicked delete when the topic came up. Well it is time to
pay attention!
On March 31, 2011, the Centers for Medicare and Medicaid
Services (CMS) released the proposed rule which would
implement a provision of the Affordable Care Act which
mandates coordination of care for Medicare beneficiaries
through Accountable Care Organizations (ACO). The goal of
ACO's is to promote overall better quality health care and to
lower growth of health care costs by creating incentives for
physicians, health care providers, hospitals and long-term
facilities to work together and meet delineated performance
standards on quality of care. The ACO providers will
distribute the shared savings derived from the coordinated
care. Patient and provider participation in the ACO is
voluntary.
ACO’s are a result of a section in the Health Care reform
act of 2009 that required the Secretary of HHS to establish
a Shared Savings Program by January 1, 2012. The Medicare
Shared Savings program is a Medicare delivery model that is
aimed at 1) better care for individuals; 2) better health
for populations; and 3) lower growth in expenditures. This
is referred to as the three part aim.
Highlights of the Proposed Rule from the APTA
“ACO Definition
• Group of health care providers accountable for the
quality, cost, and overall care of the Medicare
fee-for-service beneficiaries assigned to the organization
• Three Part Aim: 1) better care for individuals; 2) better
health for populations; and 3) lower growth in expenditures
• Must meet specified quality performance standards to
receive a share of any savings if the actual per capita
expenditures of their assigned Medicare beneficiaries are a
sufficient percentage below benchmark amounts set by CMS (ACOs
must be operational by January 2012)
ACO Proposed Structure
• ACO must have a formal and legal structure that allows the
ACO to receive and distribute payments for shared savings
• ACO will undergo a formal CMS application and approval
process
• ACO may be a corporation, partnership, LLC, foundation, or
any other entity permitted by State law
• ACO governance structure should allow for appropriate
proportionate control for ACO participants, giving each ACO
participant a voice in the decision making process
• Governing body must have representatives from Medicare FFS
beneficiaries and each ACO provider/ participant
• Allows for partnering with private entities but ACO
participants must have at least 75 percent control of the
ACO’s governing body
• ACO must develop and implement evidence-based medical
practice or clinical guidelines and processes for delivering
care based on three part aim
• ACO providers/suppliers and participants must commit to a
three-year contract (CMS lays out remedial actions for
removing participants for non-compliance)
• 5000 yearly patient threshold requirement
• Participation purely voluntary for providers and patients
• ACOs must notify patients that they are a part of an ACO
and that health information will be shared among ACO
providers and participants
Eligible Providers
• There are two types of health care providers/suppliers who
can participate in the ACO: o ACO professionals (hospitals
and physicians) in group practice arrangements, networks of
individual practices of ACO professionals, partnerships or
joint venture arrangements between hospitals and ACO
professionals, and hospitals employing ACO professionals,
and critical access hospitals (CAHs).
o ACO participants – ACO professionals could contract and
participate in ACOs but could not form ACOs on own (PTs in
private practice, physical therapy groups, Rehab Agencies,
SNFs, HHAs)
• ACO identified through TIN (may or may not be Medicare
enrolled entities)
• ACO participants must be Medicare enrolled (ACO will
report a list of NPIs)
Proposed Quality and Monitoring
• Formation of a physician-directed quality assurance and
process improvement committee that would oversee an ongoing
quality assurance and improvement program that would be
accountable for meeting performance and compliance standards
• CMS will conduct site visits and will require patient
surveys, and quarterly and annual reports focused on five
domains:
o Patient/caregiver care experiences;
o Care coordination;
o Patient safety;
o Preventive health; and
o At-risk population/frail elderly health
• 65 measures for use in the calculation of the ACO Quality
Performance Standard
• Quality standard based on a measure scale with a minimum
attainment level
• For the first year of the three year period - quality
performance standard at the reporting level
• Proposed quality measures aligned with PQRS, EHR Incentive
Program, and Hospital Inpatient Quality Reporting Program
• ACO providers/suppliers and participants who are also
eligible professionals under PQRS may earn PQRS incentives
as a group practice under the Shared Savings Program
Proposed Shared Savings
• ACOs paid under current Medicare FFS payment
• Shared savings payments directly to the ACO as identified
by its TIN
• CMS would develop a benchmark for each ACO to assess
performance
• Benchmark is an estimate of total Medicare FFS Parts A and
B costs for ACO patient population if provided absent ACO
• Benchmark factors in patient characteristics, geographic
location, etc
• Benchmark updated each year of the three-year period
• CMS proposes minimum savings rate based on percentage of
the benchmark that the ACO must exceed
• 25% of ACO shared savings payments will be withheld to
ensure pay back of any losses incurred to CMS
• ACOs must opt into one of two risk-sharing models, which
will determine the percentage of savings that ACOs are
eligible to receive: o One-Sided Risk Model—Savings are
shared for the first two years and then in the third year
savings and losses are shared (50% of the savings are
shared)
o Two-Sided Risk Model—Savings and losses are shared for all
three years (60% of the savings are shared)”
The APTA and PPS are preparing comments to make sure
Physical Therapists interests are protected. These comments
are due by June 6th. As you can see, according to the above
language, Physical Therapists are not excluded from
participation, however they are not necessarily included
either.
It would appear that it is in the best interest of Physical
Therapists to stay on top of current legislative activities.
There are constant changes to health care reform, and the
APTA is an excellent resource for information for you.
Stay tuned, there will be more to follow.
Other Physical Therapy Private Practice related
articles by Chad
-
Starting a Private Physical Therapy Practice
-
Basic Equipment for Starting a Private Physical Therapy
Practice
Last revised: April 12, 2011
by Chad Novasic, PT
