H. R. 3590—277 
(2) in paragraph (82), by striking the period at the end 
and inserting ‘‘; and’’; and 
(3) by inserting after paragraph (82) the following new 
paragraph: 
‘‘(83) provide for implementation of the payment models 
specified by the Secretary under section 1115A(c) for 
implementation on a nationwide basis unless the State dem-
onstrates to the satisfaction of the Secretary that implementa-
tion would not be administratively feasible or appropriate to 
the health care delivery system of the State.’’. 
(c) REVISIONS TO HEALTH CARE QUALITY DEMONSTRATION PRO-
GRAM.—Subsections (b) and (f) of section 1866C of the Social Secu-
rity Act (42 U.S.C. 1395cc–3) are amended by striking ‘‘5-year’’ 
each place it appears. 
SEC. 3022. MEDICARE SHARED SAVINGS PROGRAM. 
Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) 
is amended by adding at the end the following new section: 
‘‘SHARED SAVINGS PROGRAM 
‘‘SEC. 1899. (a) ESTABLISHMENT.— 
‘‘(1) IN GENERAL.—Not later than January 1, 2012, the 
Secretary shall establish a shared savings program (in this 
section referred to as the ‘program’) that promotes account-
ability for a patient population and coordinates items and serv-
ices under parts A and B, and encourages investment in infra-
structure and redesigned care processes for high quality and 
efficient service delivery. Under such program— 
‘‘(A) groups of providers of services and suppliers 
meeting criteria specified by the Secretary may work 
together to manage and coordinate care for Medicare fee- 
for-service beneficiaries through an accountable care 
organization (referred to in this section as an ‘ACO’); and 
‘‘(B) ACOs that meet quality performance standards 
established by the Secretary are eligible to receive pay-
ments for shared savings under subsection (d)(2). 
‘‘(b) ELIGIBLE ACOS.— 
‘‘(1) IN GENERAL.—Subject to the succeeding provisions of 
this subsection, as determined appropriate by the Secretary, 
the following groups of providers of services and suppliers which 
have established a mechanism for shared governance are 
eligible to participate as ACOs under the program under this 
section: 
‘‘(A) ACO professionals in group practice arrangements. 
‘‘(B) Networks of individual practices of ACO profes-
sionals. 
‘‘(C) Partnerships or joint venture arrangements 
between hospitals and ACO professionals. 
‘‘(D) Hospitals employing ACO professionals. 
‘‘(E) Such other groups of providers of services and 
suppliers as the Secretary determines appropriate. 
‘‘(2) REQUIREMENTS.—An ACO shall meet the following 
requirements: 
‘‘(A) The ACO shall be willing to become accountable 
for the quality, cost, and overall care of the Medicare 
fee-for-service beneficiaries assigned to it.
H. R. 3590—278 
‘‘(B) The ACO shall enter into an agreement with the 
Secretary to participate in the program for not less than 
a 3-year period (referred to in this section as the ‘agreement 
period’). 
‘‘(C) The ACO shall have a formal legal structure that 
would allow the organization to receive and distribute pay-
ments for shared savings under subsection (d)(2) to partici-
pating providers of services and suppliers. 
‘‘(D) The ACO shall include primary care ACO profes-
sionals that are sufficient for the number of Medicare fee- 
for-service beneficiaries assigned to the ACO under sub-
section (c). At a minimum, the ACO shall have at least 
5,000 such beneficiaries assigned to it under subsection 
(c) in order to be eligible to participate in the ACO program. 
‘‘(E) The ACO shall provide the Secretary with such 
information regarding ACO professionals participating in 
the ACO as the Secretary determines necessary to support 
the assignment of Medicare fee-for-service beneficiaries to 
an ACO, the implementation of quality and other reporting 
requirements under paragraph (3), and the determination 
of payments for shared savings under subsection (d)(2). 
‘‘(F) The ACO shall have in place a leadership and 
management structure that includes clinical and adminis-
trative systems. 
‘‘(G) The ACO shall define processes to promote evi-
dence-based medicine and patient engagement, report on 
quality and cost measures, and coordinate care, such as 
through the use of telehealth, remote patient monitoring, 
and other such enabling technologies. 
‘‘(H) The ACO shall demonstrate to the Secretary that 
it meets patient-centeredness criteria specified by the Sec-
retary, such as the use of patient and caregiver assessments 
or the use of individualized care plans. 
‘‘(3) QUALITY AND OTHER REPORTING REQUIREMENTS.— 
‘‘(A) IN
GENERAL.—The Secretary shall determine 
appropriate measures to assess the quality of care fur-
nished by the ACO, such as measures of— 
‘‘(i) clinical processes and outcomes; 
‘‘(ii) patient and, where practicable, caregiver 
experience of care; and 
‘‘(iii) utilization (such as rates of hospital admis-
sions for ambulatory care sensitive conditions). 
‘‘(B) REPORTING REQUIREMENTS.—An ACO shall submit 
data in a form and manner specified by the Secretary 
on measures the Secretary determines necessary for the 
ACO to report in order to evaluate the quality of care 
furnished by the ACO. Such data may include care transi-
tions across health care settings, including hospital dis-
charge planning and post-hospital discharge follow-up by 
ACO professionals, as the Secretary determines appro-
priate. 
‘‘(C) QUALITY
PERFORMANCE
STANDARDS.—The Sec-
retary shall establish quality performance standards to 
assess the quality of care furnished by ACOs. The Secretary 
shall seek to improve the quality of care furnished by
H. R. 3590—279 
ACOs over time by specifying higher standards, new meas-
ures, or both for purposes of assessing such quality of 
care. 
‘‘(D) OTHER REPORTING REQUIREMENTS.—The Secretary 
may, as the Secretary determines appropriate, incorporate 
reporting requirements and incentive payments related to 
the physician quality reporting initiative (PQRI) under sec-
tion 1848, including such requirements and such payments 
related to electronic prescribing, electronic health records, 
and other similar initiatives under section 1848, and may 
use alternative criteria than would otherwise apply under 
such section for determining whether to make such pay-
ments. The incentive payments described in the preceding 
sentence shall not be taken into consideration when calcu-
lating any payments otherwise made under subsection (d). 
‘‘(4) NO DUPLICATION IN PARTICIPATION IN SHARED SAVINGS 
PROGRAMS.—A provider of services or supplier that participates 
in any of the following shall not be eligible to participate 
in an ACO under this section: 
‘‘(A) A model tested or expanded under section 1115A 
that involves shared savings under this title, or any other 
program or demonstration project that involves such shared 
savings. 
‘‘(B) The independence at home medical practice pilot 
program under section 1866E. 
‘‘(c) ASSIGNMENT OF MEDICARE FEE-FOR-SERVICE BENEFICIARIES 
TO ACOS.—The Secretary shall determine an appropriate method 
to assign Medicare fee-for-service beneficiaries to an ACO based 
on their utilization of primary care services provided under this 
title by an ACO professional described in subsection (h)(1)(A). 
‘‘(d) PAYMENTS AND TREATMENT OF SAVINGS.— 
‘‘(1) PAYMENTS.— 
‘‘(A) IN GENERAL.—Under the program, subject to para-
graph (3), payments shall continue to be made to providers 
of services and suppliers participating in an ACO under 
the original Medicare fee-for-service program under parts 
A and B in the same manner as they would otherwise 
be made except that a participating ACO is eligible to 
receive payment for shared savings under paragraph (2) 
if— 
‘‘(i) the ACO meets quality performance standards 
established by the Secretary under subsection (b)(3); 
and 
‘‘(ii) the ACO meets the requirement under 
subparagraph (B)(i). 
‘‘(B) SAVINGS REQUIREMENT AND BENCHMARK.— 
‘‘(i) DETERMINING SAVINGS.—In each year of the 
agreement period, an ACO shall be eligible to receive 
payment for shared savings under paragraph (2) only 
if the estimated average per capita Medicare expendi-
tures under the ACO for Medicare fee-for-service bene-
ficiaries for parts A and B services, adjusted for bene-
ficiary characteristics, is at least the percent specified 
by the Secretary below the applicable benchmark under 
clause (ii). The Secretary shall determine the appro-
priate percent described in the preceding sentence to 
account for normal variation in expenditures under
H. R. 3590—280 
this title, based upon the number of Medicare fee- 
for-service beneficiaries assigned to an ACO. 
‘‘(ii) ESTABLISH
AND
UPDATE
BENCHMARK.—The 
Secretary shall estimate a benchmark for each agree-
ment period for each ACO using the most recent avail-
able 3 years of per-beneficiary expenditures for parts 
A and B services for Medicare fee-for-service bene-
ficiaries assigned to the ACO. Such benchmark shall 
be adjusted for beneficiary characteristics and such 
other factors as the Secretary determines appropriate 
and updated by the projected absolute amount of 
growth in national per capita expenditures for parts 
A and B services under the original Medicare fee- 
for-service program, as estimated by the Secretary. 
Such benchmark shall be reset at the start of each 
agreement period. 
‘‘(2) PAYMENTS FOR SHARED SAVINGS.—Subject to perform-
ance with respect to the quality performance standards estab-
lished by the Secretary under subsection (b)(3), if an ACO 
meets the requirements under paragraph (1), a percent (as 
determined appropriate by the Secretary) of the difference 
between such estimated average per capita Medicare expendi-
tures in a year, adjusted for beneficiary characteristics, under 
the ACO and such benchmark for the ACO may be paid to 
the ACO as shared savings and the remainder of such difference 
shall be retained by the program under this title. The Secretary 
shall establish limits on the total amount of shared savings 
that may be paid to an ACO under this paragraph. 
‘‘(3) MONITORING AVOIDANCE OF AT-RISK PATIENTS.—If the 
Secretary determines that an ACO has taken steps to avoid 
patients at risk in order to reduce the likelihood of increasing 
costs to the ACO the Secretary may impose an appropriate 
sanction on the ACO, including termination from the program. 
‘‘(4) TERMINATION.—The Secretary may terminate an agree-
ment with an ACO if it does not meet the quality performance 
standards established by the Secretary under subsection (b)(3). 
‘‘(e) ADMINISTRATION.—Chapter 35 of title 44, United States 
Code, shall not apply to the program. 
‘‘(f) WAIVER
AUTHORITY.—The Secretary may waive such 
requirements of sections 1128A and 1128B and title XVIII of this 
Act as may be necessary to carry out the provisions of this section. 
‘‘(g) LIMITATIONS ON REVIEW.—There shall be no administrative 
or judicial review under section 1869, section 1878, or otherwise 
of— 
‘‘(1) the specification of criteria under subsection (a)(1)(B); 
‘‘(2) the assessment of the quality of care furnished by 
an ACO and the establishment of performance standards under 
subsection (b)(3); 
‘‘(3) the assignment of Medicare fee-for-service beneficiaries 
to an ACO under subsection (c); 
‘‘(4) the determination of whether an ACO is eligible for 
shared savings under subsection (d)(2) and the amount of such 
shared savings, including the determination of the estimated 
average per capita Medicare expenditures under the ACO for 
Medicare fee-for-service beneficiaries assigned to the ACO and 
the average benchmark for the ACO under subsection (d)(1)(B);