Accountable Care Organizations and Antitrust: Restructuring the Health Care Market

By Richard M. Scheffler, Stephen M. Shortell, and Gail R. Wilensky | Published April 2012 in JAMA | Link to Full Article

On October 20, 2011, The Centers for Medicare & Medicaid Services (CMS) released the final rules for accountable care organizations (ACOs), a highly publicized initiative of the Affordable Care Act. Accountable care organizations are part of the Medicare Shared Savings Program, which is charged with improving quality of care for Medicare patients. The CMS provided incentives for ACOs to deliver high-quality care at reduced rates of spending by providing a more coordinated team approach to health care delivery. On the same day, the Federal Trade Commission and Department of Justice provided guidelines addressing antitrust issues involving the formation of ACOs. The concern is that ACOs can result in a reduced number of competitors in health care markets, which could potentially increase prices and have negative consequences for consumers and purchasers of care. The CMS, the Federal Trade Commission, and the Department of Justice are seeking balance between integration efficiencies and market power in ACOs. This piece examines the 5 major issues physician leaders and policy makers will need to consider in the creation of ACOs. These include the following: market definition and power, efficiency and quality metrics, physician and hospital exclusivity, public-private cost shifting, and monitoring.