The Department of Justice and Federal Trade Commission recently proposed new guidelines regarding antitrust enforcement of accountable care organizations — the new health care delivery model mandated by the 2010 Patient Protection and Affordable Care Act (PPACA) pursuant to its “shared savings program.” This statement was issued in conjunction with the Department of Health and Human Services’ Centers for Medicare and Medicaid Services’ (CMS) proposed regulations implementing the shared savings program, as part of a coordinated interagency effort to facilitate health care provider participation in the shared savings program, so as to achieve the cost savings and improvement in quality of care Congress intended.
Accountable care organizations (ACOs) are, in essence, collaborations of independent health care providers and/or provider groups (including physician practice groups, hospitals, physician-hospital organizations and any other provider groups that CMS deems appropriate) centered around the concept of enhanced coordination of care to improve both the quality and cost of care. ACOs are to be accountable for the overall care of a defined population of Medicare beneficiaries, and upon meeting certain performance standards set by CMS, awarded some portion of any savings realized (in addition to traditional fee-for-service payments). The statement is intended to ensure that providers have the antitrust clarity and guidance necessary to form pro-competitive ACOs, while also ensuring against the unintended effect of reducing competition and harming consumers through higher prices or lower quality of care. To that end, it sets forth varying levels of antitrust scrutiny applicable to: (1) ACOs with “primary service area (PSA) shares” of “common services” (defined below) of 30 percent or less; (2) ACOs with PSA shares of common services greater than 50 percent; and (3) ACOs with PSA shares of common services greater than 30 percent but less than or equal to 50 percent.
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