On October 20, the administration substantially revised the rules regarding accountable care organizations (ACOs). Accountable care organizations are meant to handle care for patients across a full range of settings, including primary-care and specialist offices, hospitals, and nursing facilities in the hopes that it could reduce healthcare related expenditures. Administration officials estimated the program would reduce Medicare spending by up to $940 million over four years. The rules note that in order to ensure that ACOs do not provide less care, they will have to meet detailed quality standards in four areas: patient experience, care coordination and patient safety, preventive health care, and care for at-risk populations. Among the changes to the rules was the administration’s decision to slash the number of quality measures that ACOs must meet from 65 to 33. Officials also adjusted the formula for calculating the proportion of savings that ACOs can keep in order to give them a greater stake in the outcome. Additionally, reports indicate that the most significant change was to scrap a requirement that ACOs take the hit if their costs exceeded government targets.

Although it has only been a few days since the new rules were released, they are already getting a much more positive reception than the draft regulations issued a few months ago. The American Medical Group Association (AGMA), which represents more than 400 large provider organizations were among the most vocal critics of the administration’s first set of rules. Now however, AMGA’s senior director for health policy noted last week that they’re pretty happy with the new rule stating that, “the changes from the proposed rule to the current version seem to be significant and that’s a very good thing.”

Link: Rule Changes for ACOs