Healthcare Update: New ACOs Approved; More States Receive Approval for Exchanges


    On January 10, the U.S. Department of Health & Human Services (HHS) announced that it had approved 106 new accountable care organizations (ACOs), bringing the total approved to 259 thus far. An HHS official had predicted in November that the number of ACOs might double in January. ACOs contract with Medicare to provide coordinated care to Medicare beneficiaries under the Medicare Shared Savings Program, established under the Patient Protection and Affordable Care Act (PPACA).

    ACOs that satisfy certain prescribed quality criteria and reduce healthcare costs for their patient populations will be entitled to share in the savings realized by the Medicare program. About 4 million Medicare beneficiaries are now potentially covered by ACOs, according to HHS Secretary Kathleen Sebelius. Many other “ACO-like” organizations have also been formed, often in conjunction with health insurance companies, to coordinate care to non-Medicare patient populations. A further discussion of ACOs may be found here.

    ACOs have now been approved in most U.S. states, plus the District of Columbia and Puerto Rico. The newly approved ACOs are mostly located in the Northeastern U.S. (particularly Massachusetts and Connecticut), the Florida/Georgia area, California, and Texas.

    On January 3, HHS Secretary Sebelius announced that eight more states had been conditionally approved to operate health insurance exchanges, either by themselves or in partnership with the federal government. This brings the total number of approvals thus far to 19 states, plus the District of Columbia. Other states still have until February 15, 2013 to elect to operate State Partnership Exchanges. Residents of any state that chooses not to operate its own exchange, either alone or in partnership with the federal government, will be able to purchase insurance on a “federally facilitated exchange” beginning October 1, 2013. PPACA requires that an exchange of one type or another be operating in every state as of January 1, 2014.

    Edwards Wildman’s Healthcare Practice Group will continue to monitor healthcare news from Capitol Hill, CMS, HHS, and other federal and state agencies and courts, and will bring you timely updates as new developments occur.

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