Advance Payment Model for ACOs Designed to Ease Start-Up Costs

Coinciding with the release of the final rule for accountable care organizations, CMS also announced its Advance Payment Model yesterday.

The model is designed for participants in the Medicare Shared Savings Program in need of prepayment of expected shared savings to build their ACO. The model will test whether pre-paying a portion of those savings will increase participation or savings in the MSSP.

Advanced payments will then be recouped from the savings the ACO earns in the MSSP. CMS plans to commit up to $170 million to the Advance Payment Model for ACOs that enter the MSSP in April or July 2012.

The Advance Payment ACO Model is open to only two types of organizations participating in the Shared Savings Program:

• ACOs that do not include any inpatient facilities AND have less than $50 million in total annual revenue.
• ACOs in which the only inpatient facilities are critical access hospitals and/or Medicare low-volume rural hospitals AND have less than $80 million in total annual revenue.

Applications for the model are expected to be released soon.

Related Articles on the ACOs:

8 Things to Know About the ACO Final Rule
ACO Final Rule Released
HHS Awards $19.3M to Train Primary Care Providers


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