Medicare Shared Savings Program
Assume the following facts. An accountable care organization (ACO) has entered into a participation agreement with the secretary of the U.S. Department of Health and Human Services (HHS) to participate in the Medicare Shared Savings Program. The ACO remains in good standing under its participation agreement. The healthcare providers participating in the ACO include one hospital and approximately 100 physicians.
The ACO is proposing to give all of its Medicare patients a free electronic tablet device. In addition, the ACO will pay all of the costs for installation and monthly service, in order to connect the tablets by satellite. The tablet will contain an app that will remind Medicare patients to take each dose of medication as prescribed or directed by the physician. Moreover, by touching a box on the screen of the tablet, the app will enable patients to record the fact that they have taken the dose, and that information will be transmitted electronically to the offices of their physicians. The medications that will be tracked by the tablet may include some preventive care but will not be limited to preventive care.
The cost of this type of tablet is $600. The cost of installation and monthly service for a one-year contract is $400. Therefore, the total cost for each Medicare patient during the first year will be $1,000. As a practical matter, Medicare beneficiaries might be able to use the tablet for personal purposes and not merely for purposes related to their medical care. For convenience, all of the foregoing information may be referred to simply as “the proposal.”
Your task is to answer all of the following questions under the assumed set of facts. If you think you need any additional facts, please state the facts that you think are needed and explain how those facts would affect your analysis.
1. Identify the federal law (or laws) that would be waived by the specific waiver on which the ACO and its participants intend to rely. Explain what is prohibited by that law (or laws), and explain how the proposal could violate that law (or laws) in the absence of a waiver.
2. Summarize the requirements that must be met to qualify for the specific waiver.
3. Analyze whether the proposal meets all of the requirements for the specific waiver. State the arguments (if any) for concluding that the proposal meets all of those requirements, as well as the arguments (if any) for concluding that the proposal does not meet them. Be sure to state your conclusion and explain the basis for it.
4. As a matter of policy, explain whether you think that the requirements for that specific waiver should be changed by the secretary of HHS. Specifically, should the secretary amend the requirements for that specific waiver to balance the goal of beneficiary compliance with care management programs against the risk that ACOs could use extravagant incentives to steer beneficiaries? Be sure to state your conclusion and explain your reasoning for amending or not amending those requirements.
