The American Hospital Association called for major changes to Medicare's accountable care organization proposals “to make the program operationally viable and attractive to potential participants.”

The trade group, in a letter to the CMS, repeated criticisms voiced by health systems and doctors ahead of the June 6 deadline for public comment on ACO proposals released in late March. The “CMS' overall risk versus reward equation tilts too much toward risk and too little toward reward,” the AHA said.

The hospital association called for the CMS to increase potential bonuses and reduce the number of required quality measures to be reported for ACOs. Earlier this week, the AHA argued in a separate letter on Medicare ACOs that the CMS does not have power to enforce antitrust laws against the emerging networks.

Under the Patient Protection and Affordable Care Act, Medicare accountable-care contracts may share savings with hospitals and doctors that curb patients' healthcare costs and meet quality targets. Proposed rules offer potential bonuses but also put providers at risk for penalties for one or three years, depending on which of two options providers select for three-year ACO contracts.

The AHA urged the CMS to eliminate possible penalties for one of the two options. Or the CMS could contract for five or six years, with potential penalties in the final year, to allow providers enough time to prepare for financial risk.

The CMS should also increase potential bonus payments to 80% to 90% of savings for eligible ACOs, with payouts linked to quality performance. The CMS rule proposed bonuses of 50% to 60%, which the AHA suggested should become the minimum amount providers could earn for bonuses.

Quality performance in prior CMS efforts began with a small number of measures that grew gradually, the AHA noted. “We encourage CMS to look to existing quality reporting programs and apply lessons learned from these efforts to the ACO program,” the letter said.

The hospital association said the CMS should assign patients to ACOs from the outset of the contracts, rather than retroactively, as proposed. Half of primary-care providers must achieve status as health information technology “meaningful users” after the ACO contract's first year, which the AHA said is likely unrealistic. The CMS should require monitoring and later create requirements for ACO IT adoption, the letter said.