42 USC 1395jjj - Shared savings program

U.S Code last checked for updates: Apr 28, 2024

§ 1395jjj.

Shared savings program

(a)

Establishment

(1)

 So in original. No par. (2) has been enacted.

In general

Not later than January 1, 2012, the Secretary shall establish a shared savings program (in this section referred to as the “program”) that promotes accountability for a patient population and coordinates items and services under parts A and B, and encourages investment in infrastructure and redesigned care processes for high quality and efficient service delivery. Under such program—

(A)

groups of providers of services and suppliers meeting criteria specified by the Secretary may work together to manage and coordinate care for Medicare fee-for-service beneficiaries through an accountable care organization (referred to in this section as an “ACO”); and

(B)

ACOs that meet quality performance standards established by the Secretary are eligible to receive payments for shared savings under subsection (d)(2).

(b)

Eligible ACOs

(1)

In general

Subject to the succeeding provisions of this subsection, as determined appropriate by the Secretary, the following groups of providers of services and suppliers which have established a mechanism for shared governance are eligible to participate as ACOs under the program under this section:

(A)

ACO professionals in group practice arrangements.

(B)

Networks of individual practices of ACO professionals.

(C)

Partnerships or joint venture arrangements between hospitals and ACO professionals.

(D)

Hospitals employing ACO professionals.

(E)

Such other groups of providers of services and suppliers as the Secretary determines appropriate.

(2)

Requirements

An ACO shall meet the following requirements:

(A)

The ACO shall be willing to become accountable for the quality, cost, and overall care of the Medicare fee-for-service beneficiaries assigned to it.

(B)

The ACO shall enter into an agreement with the Secretary to participate in the program for not less than a 3-year period (referred to in this section as the “agreement period”).

(C)

The ACO shall have a formal legal structure that would allow the organization to receive and distribute payments for shared savings under subsection (d)(2) to participating providers of services and suppliers.

(D)

The ACO shall include primary care ACO professionals that are sufficient for the number of Medicare fee-for-service beneficiaries assigned to the ACO under subsection (c). At a minimum, the ACO shall have at least 5,000 such beneficiaries assigned to it under subsection (c) in order to be eligible to participate in the ACO program.

(E)

The ACO shall provide the Secretary with such information regarding ACO professionals participating in the ACO as the Secretary determines necessary to support the assignment of Medicare fee-for-service beneficiaries to an ACO, the implementation of quality and other reporting requirements under paragraph (3), and the determination of payments for shared savings under subsection (d)(2).

(F)

The ACO shall have in place a leadership and management structure that includes clinical and administrative systems.

(G)

The ACO shall define processes to promote evidence-based medicine and patient engagement, report on quality and cost measures, and coordinate care, such as through the use of telehealth, remote patient monitoring, and other such enabling technologies.

(H)

The ACO shall demonstrate to the Secretary that it meets patient-centeredness criteria specified by the Secretary, such as the use of patient and caregiver assessments or the use of individualized care plans.

(I)

An ACO that seeks to operate an ACO Beneficiary Incentive Program pursuant to subsection (m) shall apply to the Secretary at such time, in such manner, and with such information as the Secretary may require.

(3)

Quality and other reporting requirements

(A)

In general

The Secretary shall determine appropriate measures to assess the quality of care furnished by the ACO, such as measures of—

(i)

clinical processes and outcomes;

(ii)

patient and, where practicable, caregiver experience of care; and

(iii)

utilization (such as rates of hospital admissions for ambulatory care sensitive conditions).

(B)

Reporting requirements

(C)

Quality performance standards

(D)

Other reporting requirements

(4)

No duplication in participation in shared savings programs

A provider of services or supplier that participates in any of the following shall not be eligible to participate in an ACO under this section:

(A)

A model tested or expanded under section 1315a of this title that involves shared savings under this subchapter, or any other program or demonstration project that involves such shared savings.

(B)

The independence at home medical practice pilot program under section 1395cc–5 of this title.

(c)

Assignment of Medicare fee-for-service beneficiaries to ACOs

(1)

In general

Subject to paragraph (2), the Secretary shall determine an appropriate method to assign Medicare fee-for-service beneficiaries to an ACO based on their utilization of—

(A)

in the case of performance years beginning on or after April 1, 2012, primary care services provided under this subchapter by an ACO professional described in subsection (h)(1)(A); and

(B)

in the case of performance years beginning on or after January 1, 2019, services provided under this subchapter by a Federally qualified health center or rural health clinic (as those terms are defined in section 1395x(aa) of this title), as may be determined by the Secretary.

(2)

Providing flexibility

(A)

Choice of prospective assignment

(B)

Assignment based on voluntary identification by medicare fee-for-service beneficiaries

(i)

In general

(ii)

Notification process

The Secretary shall establish a process under which a Medicare fee-for-service beneficiary is—

(I)

notified of their ability to make an identification described in clause (i); and

(II)

informed of the process by which they may make and change such identification.

(iii)

Superseding claims-based assignment

(d)

Payments and treatment of savings

(1)

Payments

(A)

In general

Under the program, subject to paragraph (3), payments shall continue to be made to providers of services and suppliers participating in an ACO under the original Medicare fee-for-service program under parts A and B in the same manner as they would otherwise be made except that a participating ACO is eligible to receive payment for shared savings under paragraph (2) if—

(i)

the ACO meets quality performance standards established by the Secretary under subsection (b)(3); and

(ii)

the ACO meets the requirement under subparagraph (B)(i).

(B)

Savings requirement and benchmark

(i)

Determining savings

(ii)

Establish and update benchmark

(2)

Payments for shared savings

(3)

Monitoring avoidance of at-risk patients

(4)

Termination

(e)

Administration

(f)

Waiver authority

(g)

Limitations on review

There shall be no administrative or judicial review under section 1395ff of this title, section 1395oo of this title, or otherwise of—

(1)

the specification of criteria under subsection (a)(1)(B);

(2)

the assessment of the quality of care furnished by an ACO and the establishment of performance standards under subsection (b)(3);

(3)

the assignment of Medicare fee-for-service beneficiaries to an ACO under subsection (c);

(4)

the determination of whether an ACO is eligible for shared savings under subsection (d)(2) and the amount of such shared savings, including the determination of the estimated average per capita Medicare expenditures under the ACO for Medicare fee-for-service beneficiaries assigned to the ACO and the average benchmark for the ACO under subsection (d)(1)(B);

(5)

the percent of shared savings specified by the Secretary under subsection (d)(2) and any limit on the total amount of shared savings established by the Secretary under such subsection; and

(6)

the termination of an ACO under subsection (d)(4) or of an ACO Beneficiary Incentive Program under subsections (b)(2)(I) and (m).

(h)

Definitions

In this section:

(1)

ACO professional

The term “ACO professional” means—

(A)

a physician (as defined in section 1395x(r)(1) of this title); and

(B)

a practitioner described in section 1395u(b)(18)(C)(i) of this title.

(2)

Hospital

(3)

Medicare fee-for-service beneficiary

(i)

Option to use other payment models

(1)

In general

(2)

Partial capitation model

(A)

In general

(B)

No additional program expenditures

(3)

Other payment models

(A)

In general

(B)

No additional program expenditures

(j)

Involvement in private payer and other third party arrangements

(k)

Treatment of physician group practice demonstration

(l)

Providing ACOs the ability to expand the use of telehealth services

(1)

In general

In the case of telehealth services for which payment would otherwise be made under this subchapter furnished on or after January 1, 2020

(A)

Inclusion of home as originating site

(B)

No application of geographic limitation

(2)

Definitions

In this subsection:

(A)

Applicable ACO

The term “applicable ACO” means an ACO participating in a model tested or expanded under section 1315a of this title or under this section—

(i)

that operates under a two-sided model—

(I)

described in section 425.600(a) of title 42, Code of Federal Regulations; or

(II)

tested or expanded under section 1315a of this title; and

(ii)

for which Medicare fee-for-service beneficiaries are assigned to the ACO using a prospective assignment method, as determined appropriate by the Secretary.

(B)

Home

(3)

Telehealth services received in the home

In the case of telehealth services described in paragraph (1) where the home of a Medicare fee-for-service beneficiary is the originating site, the following shall apply:

(A)

No facility fee

(B)

Exclusion of certain services

(m)

Authority to provide incentive payments to beneficiaries with respect to qualifying primary care services

(1)

Program

(A)

In general

(B)

Implementation

(2)

Conduct of program

(A)

Duration

(B)

Scope

An ACO Beneficiary Incentive Program established under this subsection shall provide incentive payments to all of the following Medicare fee-for-service beneficiaries who are furnished qualifying services by the ACO:

(i)

With respect to the Track 2 and Track 3 payment models described in section 425.600(a) of title 42, Code of Federal Regulations (or in any successor regulation), Medicare fee-for-service beneficiaries who are preliminarily prospectively or prospectively assigned (or otherwise assigned, as determined by the Secretary) to the ACO.

(ii)

With respect to any future payment models involving two-sided risk, Medicare fee-for-service beneficiaries who are assigned to the ACO, as determined by the Secretary.

(C)

Qualifying service

For purposes of this subsection, a qualifying service is a primary care service, as defined in section 425.20 of title 42, Code of Federal Regulations (or in any successor regulation), with respect to which coinsurance applies under part B, furnished through an ACO by—

(i)

an ACO professional described in subsection (h)(1)(A) who has a primary care specialty designation included in the definition of primary care physician under section 425.20 of title 42, Code of Federal Regulations (or any successor regulation);

(ii)

an ACO professional described in subsection (h)(1)(B); or

(iii)

a Federally qualified health center or rural health clinic (as such terms are defined in section 1395x(aa) of this title).

(D)

Incentive payments

An incentive payment made by an ACO pursuant to an ACO Beneficiary Incentive Program established under this subsection shall be—

(i)

in an amount up to $20, with such maximum amount updated annually by the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the previous year;

(ii)

in the same amount for each Medicare fee-for-service beneficiary described in clause (i) or (ii) of subparagraph (B) without regard to enrollment of such a beneficiary in a medicare supplemental policy (described in section 1395ss(g)(1) of this title), in a State Medicaid plan under subchapter XIX or a waiver of such a plan, or in any other health insurance policy or health benefit plan;

(iii)

made for each qualifying service furnished to such a beneficiary described in clause (i) or (ii) of subparagraph (B) during a period specified by the Secretary; and

(iv)

made no later than 30 days after a qualifying service is furnished to such a beneficiary described in clause (i) or (ii) of subparagraph (B).

(E)

No separate payments from the Secretary

(F)

No application to shared savings calculation

(G)

Reporting requirements

(H)

Termination

(3)

Exclusion of incentive payments

Any payment made under an ACO Beneficiary Incentive Program established under this subsection shall not be considered income or resources or otherwise taken into account for purposes of—

(A)

determining eligibility for benefits or assistance (or the amount or extent of benefits or assistance) under any Federal program or under any State or local program financed in whole or in part with Federal funds; or

(B)

any Federal or State laws relating to taxation.

(Aug. 14, 1935, ch. 531, title XVIII, § 1899, as added and amended Pub. L. 111–148, title III, § 3022, title X, § 10307, Mar. 23, 2010, 124 Stat. 395, 940; Pub. L. 114–255, div. C, title XVII, § 17007, Dec. 13, 2016, 130 Stat. 1338; Pub. L. 115–123, div. E, title III, §§ 50324(a), 50331, 50341(a), Feb. 9, 2018, 132 Stat. 203, 205, 206.)

cite as: 42 USC 1395jjj