In commentary to the proposed regulations, CMS has committed to coordinate with other Federal agencies on various issues that relate to the Shared Savings Program. This includes coordination with the FTC and DOJ (the “Antitrust Agencies”) with respect to antitrust issues. This coordination is shown through CMS’s intention to incorporate the FTC/DOJ Proposed Statement on Antitrust Enforcement Policy Regarding ACOs (the “Antitrust Policy Statement”) into the ACO application process.
Generally, CMS intends to exclude ACOs with market power from participation in the program in certain circumstances. More specifically, an ACO with a primary service area (“PSA”) share above 50% for any common service that two or more ACO participants provide to patients from the same PSA must submit, as part of its Shared Savings Program application, a letter from an Antitrust Agency confirming no present intent to challenge or recommend challenging the new ACO. For ACOs with a PSA share in the 30-49% range, the applicant may either (i) request an expedited review by the Antitrust Agencies and submit a letter from the reviewing agency confirming no present intent to challenge; (ii) begin to operate and abide by a list of conduct restrictions (identified in the Antitrust Policy Statement); or (iii) begin to operate and remain subject to antitrust investigation if it presents competitive concerns (i.e. take the risk).
Given the antitrust sensitivity relating to the ACO program, this shouldn’t be surprising. However, looking at the specifics reveals a few issues that can present problems for ACO participants. First, the proposed ACO regulations require each ACO to notify CMS at least 30 days before any material change of its ACO participants and must submit a recalculation of PSA shares (presumably with this notice, although that’s not specifically stated). This requirement applies to all ACOs, not just those above 50% PSA share or on the 30%-49% PSA share bubble. Also, what constitutes a “material change” is not defined. This requirement appears to impose an ongoing obligation on the part of all ACOs to monitor PSA share. However, as Chris previously noted, an ACO within the 30% PSA share “safety zone” will not lose safety zone status if it exceeds the 30% PSA share limitation solely because the ACO attracts more patients.
If any revised PSA share is calculated to be greater than 50%, the ACO will be subject to review or re-review by an Antitrust Agency in order to remain eligible to participate in the Shared Savings program. Again this raises significant questions. For example, are Shared Savings payments suspended, held in escrow, etc. while this review is ongoing? Does this mean that that an ACO that had a 51% share must be subjected to re-review if its share rises to, say, 52%? Presumably, while a 5%-10% increase in participation could trigger mandatory review if the relevant threshold is crossed, a 1%-2% increase would probably not trigger such review. Nevertheless, the proposed regulations do not further address this point.
In short, like many other aspects of the proposed regulations, these provisions will likely require further development.