• ACOs must have a formal legal structure that allows the organization to receive and disburse shared savings payments to participating providers.
• ACOs must be voluntary, particularly because relationships will be redefined among health care entities that may not have worked together in the past.
• Participating provider groups must be adequately represented on the governing board of each ACO; a majority of the Board, however, should be physicians. The governing board also should include reasonable administrative and financial expertise as well as community representation.
• Each ACO must have sufficient human resource commitment to oversee the day-to-day operations of the ACO, to work with payors, monitor performance, and collect and distribute any shared savings. There should be adequate performance improvement mechanisms to monitor and coordinate utilization of services designed to ensure quality of care and control costs. ACOs should have widespread utilization of health information technology for provision of point-of-care information, data tracking, data aggregation, protocol dissemination, and performance monitoring. All data shall be clinically validated by physicians and severity adjusted.
• Participating providers must be committed to working with other providers in the ACO to continually improve processes, coordination, quality, and efficiency of care and decreasing costs and eliminating waste.
• ACOs should consider governance and tax-status options that encourage reinvestment of operating margins in quality improvement, incentives and bonuses for providers to optimize care, and that discourage windfall profit taking by large shareholders or originators of the ACO. ACOs should preferably be organized as a non-profit entity.

Preservation of the Patient-Physician Relationship

• Adequate and independent physician input is necessary to ensure that appropriate evidence-based care is coordinated and delivered in the manner most beneficial to patients.
• The ACO should promote: evidence-based medicine and patient engagement; reporting on quality, cost, and patient satisfaction measures; and coordination of care, such as through the use of telehealth, remote patient monitoring, and other such enabling technologies.
• Patients must retain the right to choose their physicians to the fullest degree possible.
• Patients should be incentivized to become engaged in health and wellness activities and compliance.
• ACOs must maintain flexibility in regards to site of care to ensure that care is delivered in the most appropriate and cost-effective setting.

Incentive Payments

• Equitable opportunities for collaboration and incentive sharing must apply to all participating providers.
• A clear, sustainable, transparent and fair method should be utilized for setting performance-based incentive payment rates and bonuses, which is physician-driven. The method should be based on accurate data and peer reviewed evidence-based methodology that applies to all participants, regardless of employment status. Patient satisfaction, where applicable, should be a factor.
• The ACO must have a mechanism to provide accurate and transparent reporting to the ACO member, who has an opportunity for peer review, feedback to the governing body and appeal rights of payment decisions.