According to Steve Lieberman, a visiting scholar at the Engelberg Center for Health Care Reform at the Brookings Institution and the president of Lieberman Consulting Inc., an Accountable Care Organization (ACO) aims to replicate "the performance of an HMO" in holding down the cost of care while avoiding "the structural features that give the HMO control over [patient] referral patterns," which limited patient options.
Partnerships or joint venture arrangements between hospitals and ACO professionals, hospitals employing ACO professionals, and other Medicare providers and suppliers collaborate to create a network of points of healthcare service. It is this organizational quality fostered by the Affordable Care Act that necessitated joint action by the Federal Trade Commission (FDC) and the Department of Justice (DOJ) concerning the potential for violating the Sherman Anti-trust Act by ACOs concerning “the prohibition of all contracts restraining trade, regardless of whether the restraint actually produced ill effects.”
A proposed Antitrust Policy Statement frames the FTC and DOJ thinking on establishing different levels of antitrust scrutiny depending on the specific ACO arrangement. This policy intends to “give providers the clear and practical guidance they need to form pro-competitive, innovative, integrated health care delivery systems without running afoul of antitrust laws.” The policy also defines an antitrust “safety zone” for certain ACOs wherein “an ACO’s independent participants that provide a common service must have a combined share of 30 percent or less of each common service in each participant’s Primary Service Area (PSA).
The new Stark regulations (effective as of July 24, 2004) pertaining to physician recruitment define a hospital's geographic service area as the lowest number of contiguous postal zip codes from which the hospital draws 75 percent of its inpatients, which for Stark II compliance, the admissions must be derived from the smallest reasonable and contiguous area around the hospital. The key point is that Stark II stipulates that a PSA should be geographically contiguous.
By applying the “rule of reason” where “only combinations and contracts unreasonably restraining trade are subject to actions under anti-trust laws, and that possession of monopoly power is not inherently illegal.” Organizations “that benefit both Medicare beneficiaries and patients with private health insurance, while protecting health care consumers from higher prices and lower quality will warrant an “expedited antitrust review process for these new doctor-hospital partnerships.” FTC and DOJ hope to enable cost containment and reduction rather than stifle those efforts.
Over at HHS Office of the Inspector General (OIG), fraud and abuse remain “on the front burner.” CMS and HHS OIG have a number of compliance guidance documents, including a jointly issued interim final rule with comment period establishing waivers of certain Federal laws- the physician self-referral law, the anti-kickback statute, and certain provisions of the civil monetary penalty law- in connection with the Shared Savings Program and ACOs.
Kel is a Healthcare IT concierge providing answers to HIT questions and solutions to problems. He is completing the final session of three of the Office of the National Coordinator for Health Information Technology (ONC) HIT Workforce Training program (Implementation & Support Specialist track). He makes knowledge “ensnared” in the web visible, understandable, and immediately useful.