The ABCs of ACOs A Practical Handbook on Accountable Care Organizations

by King, Raymund C.; Rose, Rachel V.; Merritt, Martin R.,; Okray, John

• ISBN13: 9781627226264
• ISBN10: 1627226265
• Edition: 1st
• Format: Paperback
• Copyright: 2015-06-07
• Publisher: American Bar Association

Summary

Understand the new model of ACOs.

This book is intended for attorneys, as well as health care providers, who are involved in the formation, maintenance, or deconstruction of a physician-owned ACO. Real-life applications involving physician-owned ACOs are used to educate the reader, as the authors leverage their vast experience as lawyers and physicians in creating ACOs.

Chapters include:

• ARRA/HITECH/HIPAA and the Business Associate Agreement
• Federal and State "Fraud and Abuse" Laws and Medical Ethics
• Antitrust Matters
• ACOs and Respondeat Superior

Author Biography

Raymund C. King, MD, JD, lives in Plano, TX.

Rachel V. Rose, JD, MBA, lives in Houston, TX.

Martin R. Merritt, JD, lives in Dallas, TX.

John Okray, JD, MBA, LLM, lives in Fort Worth, TX.

Table of Contents

Contents

Introduction and Ground Rules: The ABCs of Physician-Owned
ACOs ix
Notes xiv
About the Authors xv

1 Accountable Care Organizations 1
Health Insurance in America: A Brief History 3
Medicare and Medicaid Insurance 4
“A Broke and Broken System” 8
ACA’s Attempt to Address Health Care Fiscal Crisis 10
How ACA Accountable Care Organizations and Shared
Savings Programs Should Help 12
Accountable Care Organizations 13
The Shared Savings Program 13
Some Questions Remain with the Shared Savings
Program 15
Notes 16

2 ARRA/HITECH/HIPAA and the Business Associate
Agreement 19
Overview 19
The History of ARRA/HITECH/HIPAA 20
What is a Business Associate Agreement? 21
When Should a Business Associate Agreement Be
Utilized in the Context of ACOs? 23
Conclusion 26
Notes 26

3 Federal and State “Fraud and Abuse” Laws and
Medical Ethics 29
The History of Fraud, Waste, and Abuse Laws 29
Safe Harbors and Waivers of Fraud and Abuse Laws 32
Reporting Requirements 34
The Problem Presented by ACOs and “Shared Savings” Programs
35
AMA Ethics Opinions May Complicate Matters 36
AMA Opinion 8.0321—Physicians’ Self-Referral (Full
Text) 36
AMA Ethics Opinion 8.051—Conflicts of Interest
under Capitation (Full Text) 38
State Fraud and Abuse Laws 39
Conclusion 40
Notes 41

4 ACOs Accountable Care Organizations and Respondeat Superior
45
Overview 45
What Is Respondeat Superior? 46
The Traditional Application of Respondeat Superior 47
How Are ACOs Impacted by the Doctrine of Respondeat Superior?
49
Conclusion 51
Notes 51

5 Antitrust Matters 55
Enforcement Agencies and Private Parties 55
Overview of Relevant Antitrust Laws 56
The Application of the Sherman Act: Evolutions of the “Per Se” Rule, “Rule of Reason” Test,
“Inherently
Suspect” Test, and Financial Integration 57
Per Se Illegal 59
Rule of Reason 59
Inherently Suspect 60
Ancillary Restraints Doctrine 60
Federal Agency Health Care Antitrust Guidance before
the Affordable Care Act 61
Joint Statements of Antitrust Enforcement Policy in
Health Care 61
Statement of the Department of Justice and the Federal Trade Commission Enforcement Policy on
Physician Network Joint Ventures (“Statement 8”) 62
Safety Zones under Statement 8 62
Rule of Reason under Statement 8 63
Per Se Illegal under Statement 8 63
Statement of the Department of Justice and the Federal Trade Commission Enforcement Policy on
Multiprovider Networks (“Statement 9”) 64
Antitrust Guidelines for Collaborations among
Competitors 65
Improving Health Care: A Dose of Competition 65
Clinical Integration in Health Care: A Check-Up 66
Federal Agency Antitrust Guidance on ACOs after the Affordable Care Act
67
DOJ and FTC Statement of Antitrust Enforcement Policy Regarding Accountable Care Organizations
Participating in the Medicare Shared Savings
Program (“ACO Statement”) 68
Safety Zone under the ACO Statement 68
Rule of Reason under the ACO Statement 69
Ancillarity under the ACO Statement 69
Conduct for ACOs to Avoid 70
Voluntary Agency Antitrust Review 70
FTC Advisory Opinions Related to Health Care Joint
Ventures 72
Developments since the ACO Statement 73
Conclusion 74
Notes 74

6 ACOs and the Impact on Bundle Payments and
Value-Based Purchasing 79
Overview 79
Value-Based Purchasing 80
Bundled Payments 81
The Ability of ACOs to Capitalize on Bundled Payments
and Value-Based Purchasing 82
Conclusion 84
Notes 85

7 How to Communicate Effectively with Physicians 89
Introduction and Cultural Comparisons 89
Medicine 90
Law 90
Educational Background 91
Financial Realities 91
Surgeons 93
Invasive Non-Surgeons 93
Non-Surgeons 93
Surgeons 94
Non-Surgeons 94
Physician Groups 95
Real World Application: The Physician-Owned ACO 96

8 Determining a Corporate Structure for the ACO 99
Subchapter C Corporations 108
Subchapter S Corporations 109
Limited Liability Companies 111
Partnerships 112
Notes 117
Exhibit 1: Sample ACO Participation Agreement 127









9 The Accountable Care Organization Participant
Agreement 119
Sample Signature Page (Recommended Format) 124
Examples 125
Notes 126

10 Medical Ethics and Accountable Care Organizations 137
Introduction 137
The Medicare ACO Shared Savings Program in General 139
Governance and Ethics 140
Acceptance of ACOs by Beneficiaries and Acceptance of Beneficiaries by ACOs
141
Ethics in Referrals between Members of an ACO 142
AMA Opinion 3.04: Referral of Patients 142
AMA Ethics Opinion 8.056: Physician
Pay-for-Performance Programs 143
Opinion 8.051: Confl of Interest under Capitation 144
Relation to State Laws 145
Notes 146

11 Congratulations, You Are an Accountable Care
Organization. Now What? 149
Index 159