The new proposed regulations on accountable care organizations, released Thursday by the Department of Health and Human Services, show the government planning to link the HITECH meaningful use incentive program with its plans for ACOs.

In a March 31 article published in the New England Journal of Medicine, Donald Berwick, MD, administrator of the Centers for Medicare and Medicaid Services, said the creation of ACOs is one of the first delivery-reform initiatives that will be implemented under the Accountable Care Act.

"Its purpose is to foster change in patient care so as to accelerate progress toward a three-part aim: better care for individuals, better health for populations, and slower growth in costs through improvements in care," he said.

[See also: HHS to release ACO regs today.]

ACOs create incentives for healthcare providers to work together to treat an individual patient across care settings, according to HHS Secretary Kathleen Sebelius. Participation in an ACO will be voluntary, and Medicare Advantage plans will not be included in the ACO program. To share in savings, ACOs would have to meet quality standards in five key areas, including:

• patient/caregiver care experiences;

• care coordination;

• patient safety;

• preventive health;

• at-risk population/frail elderly health.

The proposed rules also include strong protections to ensure patients do not have their care choices limited by an ACO, she added.

The rule will be published April 7 in the Federal Register, and comments will be accepted for 60 days. The rule calls for a start date of next Jan. 1. The program is expected to save $960 million over three years for the Medicare program, Sebelius said.

Before the rule is finalized, CMS will review all comments from the public and may make changes to its proposals based on the comments, according to Sebelius.

What does this mean for vendors and providers?
Brian Ahier, health IT evangelist for Mid-Columbia Medical Center in The Dalles, Oregon, said his first take on the 400-page proposed rule is the importance of providers first achieving meaningful use of electronic health records. The rule calls for 50 percent of providers who participate in an ACO to be meaningful users.

The group practice reporting option (GPRO), an electronic reporting tool already used by the government in the physician quality reporting system, will be updated for ACO reporting use, Ahier said.

It will be key that interface between certified CHRs and the GPRO works smoothly, he added. This poses a real opportunity for EHR vendors. "If nothing else, I think we╒re seeing the unfolding of a plan for how the meaningful use program is going to be used in the implementation of new payment models," Ahier said.

[See also: Payers, providers agree - and disagree - on ACOs.]

William F. Jessee, MD, president and CEO of the Medical Group Management Association said doctors should beware the complexities found in the proposed rule.

"Physician practices need to thoroughly examine how participation in ACOs may affect their practice operations," Jessee said.

According to Jeff Gruen, director of Health Care Services at PRTM, a global management consulting firm, information technology is one of the critical pieces of infrastructure to a well-functioning ACO. "It is like the rails on which the ACO train will run," he said.

Gruen said the information technology needs to facilitate electronic of medical records and provide easy access to a labs, pharma, EMR and other key clinical data. "But this is just the information foundation,? he added. "Smart organizations will quickly build stories on top of this foundation to create a full information house," according to Gruen.

Two of the more critical pieces of information that ACOs will need are patient registries (lists of all of the patients in a practice with their risk profiles) and decision-support (intelligent rules that remind providers of steps they need to take to improve the care), he added.

Justin Barnes, chairman emeritus of the Electronic Health Record Association said the proposal "shows its teeth" by proposing a minimum sharing benchmark rate for ACO. "We know that longstanding ACO models such as those undertaken by the Mayo and Cleveland clinics are workable," he said, "and it's also noteworthy that this proposal seeks to embrace knowledge and experiences from private payers."

Follow Diana Manos on Twitter @DManos_IT_News.