Fact Sheets

IMPROVING QUALITY OF CARE FOR MEDICARE PATIENTS: ACCOUNTABLE CARE ORGANIZATIONS

Overview:

On Oct. 20, 2011, the Centers for Medicare & Medicaid Services (CMS), an agency within the Department of Health and Human Services (HHS), finalized new rules under the Affordable Care Act to help doctors, hospitals, and other health care providers better coordinate care for Medicare patients through Accountable Care Organizations (ACOs).  ACOs create incentives for health care providers to work together to treat an individual patient across care settings – including doctor’s offices, hospitals, and long-term care facilities.  The Medicare Shared Savings Program (Shared Savings Program) will reward ACOs that lower their growth in health care costs while meeting performance standards on quality of care and putting patients first.  Provider participation in an ACO is purely voluntary.

In developing this final rule, CMS worked closely with agencies across the Federal government to ensure a coordinated and aligned inter- and intra-agency effort to facilitate implementation of the Shared Savings Program.

CMS encourages all interested providers and suppliers to review this final rule and consider participating in the Shared Savings Program.

This fact sheet describes the quality measures and the method for scoring an ACO’s performance for purposes of meeting the quality performance standard under the Shared Savings Program.   CMS encourages all interested providers and suppliers to review the final rule and consider participating in the Shared Savings Program.

ACO Final Quality Measures and Performance Scoring Methodology:

Quality Measures:  The final rule adopts 33 individual measures of quality performance that will be used to determine if an ACO qualifies for shared savings.   These 33 measures span four quality domains: Patient Experience of Care, Care Coordination/Patient Safety, Preventive Health, and At-Risk Population.   The list of measures is included as an appendix to this fact sheet. The ACO quality measures align with those used in other CMS quality programs, such as the Physician Quality Reporting System, and the Electronic Health Record (EHR) Incentive Programs.  The ACO quality measures also align with the National Quality Strategy and other HHS priorities, such as the Million Hearts Initiative. 

In developing the final rule, CMS listened to industry concerns about focusing more on outcomes and considered a broad array of measures that would help to assess an ACO’s success in delivering high-quality health care at both the individual and population levels.  CMS also sought to address comments that supported adopting fewer total measures that reflect processes and outcomes, and aligning the measures with those used in other quality reporting programs, such as the Physician Quality Reporting System.

Reporting: The measures will be reported through a combination of a Web interface designed for clinical quality measure reporting, and patient experience of care surveys.  In addition, CMS claims and administrative data will be used to calculate other measures in order to reduce administrative burden.  CMS will also administer and pay for the patient experience of care survey for the first 2 years of the Shared Savings Program, 2012 and 2013.  ACOs will be responsible for selecting and paying for a CMS-certified vendor to administer the patient survey beginning in 2014. 

While an ACO’s first performance year for shared savings purposes would be 18 or 21 months, depending on the start date, quality data will be collected on a calendar year basis, beginning with the reporting period ending December 31, 2012. 

Quality Performance Scoring: As required by the Affordable Care Act, before an ACO can share in any savings created, it must demonstrate that it met the quality performance standard for that year. 

For the first performance year, CMS is defining the quality performance standard at the level of complete and accurate reporting for all quality measures.   During subsequent performance years, the quality performance standard will be phased in such that ACOs must continue to report all measures but will eventually be assessed on performance.

Pay for performance will be phased in over the ACO’s first agreement period as follows:

• Year 1: Pay for reporting applies to all 33 measures.
• Year 2: Pay for performance applies to 25 measures. Pay for reporting applies to eight measures.
• Year 3: Pay for performance applies to 32 measures. Pay for reporting applies to one measure that is a survey measure of functional status.CMS will keep the measure in pay for reporting status for the entire agreement period.  This will allow ACOs to gain experience with the measure and will provide important information to them on improving the outcomes of their patient populations.

CMS intends to establish national benchmarks for ACO quality measures and will release benchmark data at the start of the second performance year when the pay for performance phase-in begins.  For pay for performance measures, the minimum attainment level will be set at a national 30 percent or the national 30th percentile of the performance benchmark.  Perfomance benchmarks will be national and established using national FFS claims data, national MA quality reporting rates, or a flat national percentage for measures where MA or FFS claims data is not available.   Performance equal to or greater than the minimum attainment level for a measure will receive points on a sliding scale based on the level of performance.  Performance at or above 90 percent or the 90th percentile of the performance benchmark will earn the maximum points available for the measure.

The diabetes and coronary artery disease (CAD) composite measures will each receive the maximum available points if all criteria are met and zero points if one or more of the criteria are not met. The EHR Incentive Programs participation measure will be double-weighted in order to encourage EHR adoption. 

CMS will add the points earned for the individual measures within each domain and divide by the total points available for the domain to determine each of the 4 domain scores.  The domains will be weighted equally and scores averaged to determine the ACO’s overall quality performance score and sharing rate.  ACOs would need to achieve the minimum attainment level on at least 70 percent of the measures in each domain to avoid being placed on corrective action plan.

In addition to the measures used for the quality performance standards for shared savings eligibility, CMS will also use certain measures for monitoring purposes, to ensure ACOs are not avoiding at-risk patients or engaging in overuse, underuse, or misuse of health care services. 

Incorporation of the Physician Quality Reporting System into the Shared Savings Program:   The Affordable Care Act allows CMS to incorporate the Physician Quality Reporting System reporting requirements and incentive payments into the Shared Savings Program. ACO participants that include providers/suppliers who are also eligible professionals for purposes of the Physician Quality Reporting System will earn the Physician Quality Reporting System incentive as a group practice under the Shared Savings Program, by reporting required clinical quality measures through the ACO Group Practice Reporting Option web interface, in each calendar year reporting period the ACO fully and completely reports the ACO GPRO measures.    

The Shared Savings Program final rule can be downloaded at: www.ofr.gov/inspection.aspx. 

It will appear in the Nov. 2, 2011 issue of the Federal Register.  The Shared Savings Program will be established Jan. 1, 2012.

For information about applying to participate in the Shared Savings Program, please see: www.cms.hhs.gov/sharedsavingsprogram/.