A Closer Look At ACO Waivers

CMS created ACO waivers for a reason. If an ACO is not availing itself of waivers, it probably is not taking advantage of all of its opportunities to maximize quality and reduce costs, while obtaining financial and other assistance in doing so.

In a Medicare fee for service (FFS) world, the possibility exists that providers and suppliers can increase the amount of money spent for health care services through illegal kick-backs, inducements and other financial arrangements. To combat this possibility, congress and CMS has enacted  a myriad of statutes and regulations that, among other things, require providers and suppliers to interact with each other at an 'arm's length' distance. 

In a Medicare Accountable Care Organization (ACO) world, the goal is not to increase costs, but instead to reduce them,  with the ACO sharing in the cost savings provided quality can be maintained.  Thus, the incentive for an ACO and its members  to increase the amount spent on healthcare is nonexistent.  In this model, distance between providers and suppliers is no longer a benefit.

To effectively benefit from the ACO model, CMS recognizes that providers and suppliers need to closely cooperate with each other to improve quality and cost efficiency of health care. The mechanism CMS has employed is to allow for the application of certain statutes, including Stark, anti-kickback and the civil monetary penalties, to  be waived , provided certain requirements are satisfied. These ACO waivers allow ACO providers and suppliers to embrace each other in support of the delivery of quality, cost efficient health care.

There are technical requirements to  utilizing ACO waivers.  Perhaps chief among them is the requirement for transparency; an ACO must expose its waivers to public scrutiny by publishing them on its website.   Interestingly, there is no requirement, or even a procedure, for an ACO to apply to CMS or OIG for a waiver.  It goes forward at its own risk.

If an ACO is not availing itself of waivers, there are two possibilities: the ACO may be engaging in conduct prohibited by health care regulations without a waiver, subjecting itself and its participants to possible action by regulators, or the ACO is not allowing its participants, providers and suppliers to embrace each other as closely as they are allowed in obtaining the otherwise available shared savings.

Like snowflakes, ACOs may all look the same, but each one is unique.  It probably is not possible to create a blanket waiver that applies to every ACO. Each and every ACO needs to examine how it may available itself of the benefits of waivers.

This week's Friday Fast Facts was provided by:

Bradley J Brown with  Anterro Health Systems ph 352.345.6751