Medicare Shared Saving Programs, the Nature of ACOs and Antitrust Laws, Essay Example

Introduction

The following is a memorandum of the organization explaining new policies procedures and the laws of that mandate the existence of various programs in healthcare. The memorandum will address Medicare shared saving programs, the nature of ACOS and antitrust laws. Most importantly, the memorandum will tackle the ways in which antitrust violations can be avoided.

What is Medicare shared saving program?

Medicare shared saving programs is created and mandated by section 3022 of the Affordable Care act that requires the centers for Medicare and Medicaid services (CMS) to establish a shared program for facilitation, coordination and corporation among providers .this program is intended to promote the quality of healthcare for Medicare free for-service beneficiaries as well as reduce the costs which are unnecessary. Medicare shared program is designed to improve the outcome of the beneficially and the increased outcome of care by;

• Ensuring that Medicare centers are accountable for the care of Medicare free for service beneficiaries.
• Ensuring that there is improved accountability for individual Medicare for free service beneficiates, and general health management.
• Ensuring that there is coordinated care for all Medicare free for service (FFS) services for both part A and B.
• Encouraging redesigning of care processes and investment in infrastructure for Medicare services. Redesigned care processes are focused on improving in care, increase efficiency, and lower Medicare costs and other patients ACO served patients.

The entire eligible Medicare shared program service providers, hospitals, and suppliers are allowed to participate in the program only by creating or participating in an accountable care organization abbreviated ACO. According to the shared savings program final rule, ACOs enter into participation agreement with the secretary to participate in shared savings program for a period not less than three years under two models.

• ACO will have the opportunity to share the savings generated during the agreement.
• ACOs will qualify to receive hash saving share. However, they will be required to repay a percentage of the losses incurred by the Medicare program in case the costs assigned to ACOs beneficiaries exceeds particular threshold.

In general, whether in the first model or the second model, to share the percentage of the Medicare savings, ACOs must meet the required quality and savings together with other particular conditions of Medicare saving program successfully.

What are ACOs?

ACOs are group of physicians, hospitals, and other suppliers of the services that work jointly to provide coordinated care for Medicare free for service beneficiaries. ACOs main essence is to provide coordinated high quality healthcare services to Medicare patients. They ensure that patients with chronic illness get the right care at the right time to avoid unnecessary duplication of services as well as prevent medical errors. After delivering high quality care to patients and spending Medicare funds appropriately, ACOs share the savings. Federal statutes state the following groups of service providers and suppliers as eligible to participate as Accountable care organization provider (Bowers, Handel, Varanini Scheffler,2011).

• ACO professionals in group practice arrangements
• Hospitals that employ ACO professionals, joint venture arrangements between hospitals and ACO professional.
• network of ACO professional with individual practices
• any service suppliers and providers that the secretary will determine as appraise

Medicare ACO structure and governance

Medicare ACOs are legal entities with shared governance structures. They are given Taxpayer Identity Number (TIN). They can be structured as partnerships, corporations, limited liability companies, and foundations or any other entity licensed or permitted by the state law. ACOs must be able to receive and share the savings, repay shared loses, establish, report, and ensure that there is compliance with healthcare quality criteria such as quality performance standards, and other ACO functions.

The antitrust laws regarding accountable care organizations

The federal trade commission and antitrust division of the Department of justice issued a proposal statement on March 31 2011 of the enforcement of policy regarding accountable care organizations participating in Medicare sheared programs. This policy review how agencies will ensure antitrust compliance of physicians, hospitals, and other provides to ACOs. Antitrust laws are enacted to ensure that fraud, abuse and antitrust violations are held back as well as curb misuse of med carefree-for-service system. The antitrust systems ensure that the physicians have no financial incentive to refer the patient for unnecessary fixed payment and other payment.

The antitrust laws are governing the formation of ACOs are concerned with issues regarding the number of competitors in the health markets which could increase the prices and negatively impact Medicare services provision especially influencing negatively consumers and purchasers of free for service care. Antitrust efforts are aimed at prioritizing lower prices for Medicare and encourage components of consumer welfare such as enhancing quality product innovation Federal Trade Commission(2011).

How does the FTC/DOJ explain that participation in the program (and an ACO) can avoid antitrust violations?

The policy outlines of FTC and DOJ provides the standards the agencies will apply in analyzing the legality of ACOs formation and conduct under antitrust laws. FTC and DOJ outline the policies that will ensure that antitrust violations are catered for. The policies include elimination of mandatory reviews, voluntary reviews, antitrust safety zone, rule of reason and firewalls for all ACOs regardless of PSA shares.

Reference

Bowers L, Handel B, Varanini E, & Scheffler, R., ( 2011). Accountable Care Organizations & Antitrust Conference briefing document. CA.http://petris.org. Accessed 01/ 05/2012

Federal Trade Commission, (2011). Department of Justice Statement of antitrust enforcement policy regarding accountable care organizations participating in the Medicare shared savings program.

Medicare program, (2011). final waivers in connection with the Shared Savings Program. Interim final rule with comment period. Centers for Medicare & Medicaid Services (CMS) & Office ofInspector General, HHS. Fed Regist.

Rashi, M., (2011). Medicare Shared Savings Program: Accountable Care Organizations, 76 Fed. Reg. 19,52