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In our review of applications to participate in the Shared Savings Program, we received many ACO participant agreements that were not properly executed, were not between the correct parties, lacked the required provisions, contained incorrect information, or failed to comply with Sec.  425.304(c) relating to the prohibition on certain required referrals and cost shifting. When we identified such agreements, ACOs experienced processing delays, and in some cases, we were unable to approve the ACO applicant and/or its ACO participant to participate in the Shared Savings Program. Consequently, we issued guidance for ACO applicants in which we reiterated the required elements for ACO participant agreements and strongly recommended that ACOs employ good contracting practices to ensure that each of their ACO participant agreements met our requirements (see http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Downloads/Tips-ACO-Developing-Participant-Agreements.pdf).

The ACO participant agreements are necessary for purposes of program transparency and to ensure an ACO’s compliance with program requirements. Moreover, many important program operations (including calculation of shared savings, assignment of beneficiaries, and financial benchmarking), use claims and other information that are submitted to CMS by the ACO participant. Our guidance clarified that ACO participant agreements and any agreements with ACO providers/suppliers must contain the following:

• An explicit requirement that the ACO participant or the ACO provider/supplier will comply with the requirements and conditions of the Shared Savings Program (part 425), including, but not limited to, those specified in the participation agreement with CMS.
• A description of the ACO participants’ and ACO providers’/suppliers’ rights and obligations in and representation by the ACO.
• A description of how the opportunity to get shared savings or other financial arrangements will encourage ACO participants and ACO providers/suppliers to follow the quality assurance  and improvement program and evidence-based clinical guidelines.
• Remedial measures that will apply to ACO participants and ACO providers/suppliers who do not comply with the requirements of their agreements with the ACO.

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John Fisher is a seasoned health care lawyer with more than 30 years of experience advising physicians and health care providers. His practice spans a wide range of issues, including physician investments in ambulatory surgery centers, concierge and cash-based medical practices, and health care fraud prevention. John is dedicated to helping his clients navigate complex legal challenges while protecting their interests and ensuring compliance in a rapidly evolving industry.

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