December 20, 2011 News

Rules Issued for Accountable Care Organizations

ASHA's concerns about telepractice, access to speech-language and hearing services, and shared savings for speech-language and hearing professionals were not resolved in the Centers for Medicare and Medicaid Services' (CMS) final rules for accountable care organizations (ACOs), a new model for providing health care services to Medicare beneficiaries under national health care reform law.

An ACO is a network of physician group practices, hospitals, and others involved in patient care that share responsibility for providing care to Medicare patients. Much like health maintenance organizations, ACOs would bring together various health care components—primary care, specialists, hospitals, home health care, rehabilitation services—and offer providers and hospitals financial incentives ("shared savings") for controlling costs and improving quality. However, Medicare patients will continue to have the ability to choose any provider inside or outside the ACO.

ACOs are expected to create closer ties between hospitals and physicians and to be attractive to rehabilitation providers.

CMS expects that ACOs typically will include primary care physicians, specialists, and a hospital. Rehabilitation services could be provided by in-house staff or by contracted rehabilitation provider organizations. ACOs would most likely contract with a single rehabilitation organization rather than increase administrative burdens by contracting separately with speech-language pathology, physical therapy, and occupational therapy providers.

Audiology services could be incorporated into rehabilitation contracts through independent audiology contracts or ACO-participating otolaryngology practices.

Shared savings payments would be distributed to physicians and hospitals participating in the ACO and to other providers based on individual contracts and the ACO's determination of "how to equitably distribute shared savings or use the shared savings to meet the goals of the program," according to the regulations. The ACO concept can be compared to a construction contract, with the ACO as general contractor and the providers as subcontractors.

The final regulations released in October are less stringent than the proposed version. For example, prospective ACOs will not be required to assume financial risk during the first three years. Also, ACOs will be assessed on 33 quality measures (half the number initially proposed) divided into four domains: patient/caregiver experience, care coordination and patient safety, preventive health, and caring for at-risk populations. (Speech-language pathologists and audiologists already participate in the Medicare quality reporting process.) According to CMS, higher quality care will result in greater shared savings payments.

Establishing an ACO typically will cost more than $3 million. The regulations create an assistance program—$170 million for up to 50 ACOs—for physicians and small hospitals that lack the requisite capital.

In response to proposed ACO regulations issued in April, ASHA submitted comments suggesting that ACOs be required to:

  • Ensure that speech-language pathology and audiology services are accessible to patients. CMS responded that market forces will determine the need for the range of services offered.
  • Allocate an equitable portion of shared savings to speech-language pathologists and audiologists. CMS stated that it lacks legal authority to dictate this distribution.
  • Encourage the use of telepractice services provided by audiologists and speech-language pathologists. In response, CMS announced that it is preparing a separate incentive package, not limited to ACOs, that expands Medicare-reimbursable telepractice services.

ASHA will continue to analyze the impact and restrictions of ACOs, which are scheduled to begin operating in 2012. 

Mark Kander, director of health care regulatory analysis, can be reached at

cite as: Kander, M. (2011, December 20). Rules Issued for Accountable Care Organizations. The ASHA Leader.


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