With the recent announcement to extend the waivers of certain fraud and abuse laws for accountable care organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP), ACOs can continue using the waivers in their current form - at least for now. 

On October 17, 2014 the Department of Health & Human Services Centers for Medicare and Medicaid Services (CMS) announced the continuation of effectiveness of the interim final rule (IFR) regarding the waivers of certain fraud and abuse laws for ACOs participating in the MSSP. At the same time, CMS extended the timeline for publication of an interim final rule. CMS noted that “[i]n the absence of this continuation notice, the Waiver IFC would expire, creating legal uncertainty for ACOs participating in the Shared Savings Program and potentially disrupting ongoing business plans or operations of some ACOs.” 

The IFR was originally published in the November 2, 2011 Federal Register (76 FR 67801), and included five waivers that waived certain fraud and abuse laws for some ACO arrangements: (i) an ACO pre-participation waiver; (ii) an ACO participation waiver; (iii) a shared savings distribution waiver; (iv) a compliance with the Physician Self-Referral law waiver; and (v) a patient incentive waiver. Typically, there is a three-year timeline for publishing Medicare final rules after the publication of an interim final rule, although a notice of continuation can extend the publishing of the final rule for one year. The continuation here extends the timeline for publication of a final rule through November 2, 2015, meaning that the current IFR shall continue in effect until this date, unless a final rule becomes effective earlier. 

CMS explained that it is developing a proposed rule that would modify the MSSP regulations, and it intends for the final waiver regulations to align with these modifications. CMS stated, “Our decision to extend the Waiver IFC, rather than issue a final rule at this time, should not be viewed as a diminution of the Department’s commitment to establish waivers ‘to foster the success of the Shared Savings Program, the purposes of which are to promote accountability for a Medicare patient population, manage and coordinate care for Medicare fee-for-service beneficiaries, and encourage redesigned care processes to improve quality.’” Instead, CMS remains committed to balancing the need for innovative care delivery models, with protections for the Medicare program and its beneficiaries. 

Although the waivers were continued in their current form, CMS requested additional stakeholder input regarding: (i) how and to what extent ACOs are using the waivers; (ii) whether the existing waivers serve the needs of ACOs and the Medicare program; (iii) whether the waivers adequately protect the Medicare program and beneficiaries from the types of harms associated with referral payments or payments to reduce or limit services; and (iv) whether there are new or changed considerations that should inform the development of additional notice and comment rulemaking. 

For additional information about the ACO Waivers or regulatory issues involving the healthcare industry, please contact: