The Affordable Care Act (ACA) is changing the healthcare industry ... both in terms of the marketplace and the mindset about how modern medicine is approached in America. The law contains many new rules, regulations and options to change the way healthcare is consumed and practiced. Kim Harvey Looney, JD, a partner with Waller, weighed in on some of the recent missives handed down from D.C.
Accountable Care Organizations, ACOs, have seen peaks and valleys in popularity as the rules for participation shifted. Last month, however, the Department of Health and Human Services announced providers have formed another 106 ACOs nationwide. This latest round brings the total to more than 250 ACOs established since the Affordable Care Act was signed. In order to ensure cost savings don't infringe on patient safety and quality, ACOs must meet 33 quality measures focused on care coordination, patient safety, appropriate use of preventive health services, improved care for at-risk populations and the patient experience.
Looney noted ACOs are starting to gain traction. Nationally start dates were April 1 and July 1 of 2012 for the early adopters ... with most getting off the ground in July. In creating an ACO, Looney said there are multiple decisions to be made including which risk/reward option to choose, who would participate, what mechanism would be used to divide payment derived from achieved savings and who would be in charge of those decisions. Realistically, she said, everyone who participates is entering into a contractual agreement and should treat it as such.
"If somebody wanted to be so foolish as to not put anything in writing, you could just go ahead," she said of proceeding with verbal agreements. However, Looney continued, "Since you are talking about sharing money, there is going to need to be some guidance for how that is going to take place."
She added it would probably be prudent for each individual or entity to have an attorney read look over the contract. "Sometimes it's not a matter of making changes but making sure everybody understands what is there so there is no misunderstanding in the future. At least then you go into it with your eyes open."
While much of the focus on quality improvement has been on the 33 metrics included in the ACO final rules, there are other regulations in play under ACA. Even outside of the ACO structure, a group of providers could find their bottom line dependent upon the performance of others.
In 2013, ACA provides for the expansion of bundled payments for Medicare through a national pilot program encouraging hospitals and other providers to work in a coordinated fashion to improve patient care and reduce costs. With bundling, a flat fee is paid per episode of care rather than having Medicare receive separate bills from each provider. Looney noted that successful orthopaedic and cardiac bundled payment pilots provided data to Medicare that spurred ACO development.
Although providers "don't totally live or die as a group, bundled payments are the wave of the future ... you have everybody accountable," Looney said. All of these incremental steps are part of the shift to paying for value not volume by 2015.
Also new for 2013 is the rule that providers must tell a patient in writing if there is a financial incentive for the provider linked to a recommended drug or treatment option. "Pharma has done a good job of policing itself the last few years," Looney said. Prior to formal government action, she noted, the industry began making rules to limit the perks drug companies could offer providers. This new ACA rule formalizes some of those self-policing practices that have already gone in place and makes it incumbent upon physicians, hospitals, pharmacists and others to reveal if there is any investment or financial interest in a drug company or device manufacturer.
Effective Jan. 1, 2013, ACA also provided for new funding for state Medicaid programs that opt to cover preventive services at little or no cost. "The government is recognizing paying some money on the front end saves money on the back end,' Looney said of this shift in payment policy.
Another incentive to increase access is a requirement that primary care physicians in state Medicaid programs be paid no less than 100 percent of Medicare payment rates in 2013 and 2014. The pay increase, which is fully funded by the federal government, went into effect at the first of January.
Originally published in Nashville Medical News on Monday, February 4.
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