News Release
November 21, 2019 

David Pittman
NAACOS Health Policy and Communications Advisor
202-640-2689 or [email protected]


House Version of ACO “Rural Glitch” Bill Introduced
NAACOS Support Comes on National Rural Health Day 

WASHINGTON – The National Association of Accountable Care Organizations (NAACOS) today joined 13 other leading healthcare organizations in pledging its strong support for the Accountable Care in Rural America Act (H.R. 5212), a bill that corrects a Medicare policy that unfairly penalizes ACOs when they reduce costs. 

On National Rural Health Day, Reps. Suzan DelBene (D-Wash.), Ami Bera (D-Calif.), Roger Marshall (R-Kan.), and Jodey Arrington (R-Texas) introduced the bill that specifically removes an ACO’s assigned patients when calculating the costs of patients in the ACO’s region, which partially determines that ACO’s benchmark. The move would more accurately compare an ACO’s spending to its surrounding area. Last month, Sens. Catherine Cortez Masto (D-Nev.) and Pat Roberts (R-Kan.) introduced the Senate version of the bill (S. 2648), which also garnered strong support from the provider community as shown by a letter of support from 15 leading healthcare provider associations and organizations. 

In 2017, CMS began incorporating spending from other providers in the ACO’s region when calculating an ACO’s benchmark, the CMS-set spending target to which an ACO is held accountable. This regional adjustment rewards ACOs with costs lower than others in their surrounding area. Including ACO patients in the regional comparison creates an unfair adjustment for ACOs who make up the bulk of their region. Today’s bill will require CMS to remove an ACO’s assigned patients from the regional comparison group. The change is dubbed the “rural glitch” because it largely affects rural ACOs, although most ACOs would benefit. 

“This bill helps creates a more level playing field between rural ACOs and their more urban counterparts,” said Clif Gaus, Sc.D., NAACOS president and CEO. “This unintended flaw in Medicare policy sadly discourages ACOs from operating in rural areas, at a time we need to encourage participation in payment reform.” 

NAACOS was joined on the letter supporting the bill by Aledade, American College of Physician, American Hospital Association, American Medical Association, American Medical Group Association, America's Essential Hospitals, America’s Physician Groups, Association of American Medical Colleges, Federation of American Hospitals, the Health Care Transformation Task Force, Medical Group Management Association, National Rural Health Association and Premier. “This legislation fixes an important flaw in the current MSSP benchmarking methodology – a flaw that systematically disadvantages ACOs in rural areas and makes it harder for them to achieve savings even when they improve quality and reduce costs on par with their counterparts in urban areas,” the letter states. 

Said Gaus: “We thank these lawmakers for their support and urge their colleagues to pass this needed legislation.”