If the proposed and final accountable care rules could be captured in a before-and-after photo, they would look much like a weight loss ad, thanks to the lean, slimmed-down final version. The final Medicare rules scaled back measurements and regulations considerably.
Changes came as no surprise; in the end, the feds had to relent. The earlier ACO rules sparked provider uproar over the penalties built into the share savings program and the short timeline for 2012 participation. Private ACO development continued, but most early interest vanished. ACO forerunners like the Mayo Clinic and Intermountain Healthcare passed on participation, even in the Pioneer ACO model intended for organizations more experienced at coordinated care.
In the final regulations released on Oct. 20, CMS cut the number of quality markers from 65 to 33, dropped the electronic medical record requirement, made the ACO structure more flexible and added multiple starting dates throughout 2012. They also cut the penalty for not meeting quality markers for Track 1, in which the ACO shared savings with CMS for the first two years but could lose money for exceeding the Medicare norm in the third year. It will continue to offer Track 2 as a risk/reward model for all three years.
Most changes were common sense. While retaining electronic medical record use as a quality indicator, CMS will not require that 50 percent of providers achieve meaningful use status. Along with moving the start dates to April 1 and July 1, 2012, CMS will extend the first reporting year out to 18 or 21 months, giving ACOs more time to measure their progress. While it could be difficult for providers who have not adopted EMRs to monitor their progress, the extended initial reporting period should help. ACOs will receive lists of likely beneficiaries up front, giving them more preparation time for the prospective population. The first set of rules would have given ACOs no inclination about whom they might serve. Few ACO participants would jump into an environment offering no details about their beneficiary population.
The final rules do not eliminate the lingering question: Will providers form Medicare ACOs. At first glance, the final rules offer better value and less downside for physicians. Participation of a few big providers could tip the scales for more reluctant providers. But it will probably not become clear until early 2012.