August 2011 ACO Special Edition

ACO - Marketing  

By Robert H. Schwartz, Butzel Long, Bloomfield Hills, MI


Section 1899 of the Patient Protection and Affordable Care Act of 2010 (PPACA) is silent with regards to marketing activities of Accountable Care Organizations. The proposed regulations, however, released on April 7, 2011, point to Section 1899(b)(2)(H) of PPACA regarding the requirement that an ACO demonstrate it meets “patient-centeredness criteria.”1 Using the “patient-centeredness criteria” as a foundation, the proposed regulations address the marketing issue. The proposed regulations recite that not only must the ACO provide care coordination, but to be “truly patient centered”2 the ACO must not engage in activities that would prevent a beneficiary from using the full range of benefits of the Medicare Fee for Service program. Misleading or confusing communications would “not be patient centered”3 as they would restrict the beneficiary or caregiver about other choices and limit the ability of beneficiaries to be involved in their own care.

Marketing materials, communications and activities are defined to include, but not be limited to:

“… general audience materials such as brochures, advertisements, outreach events, letters to beneficiaries, web pages, mailings or other activities conducted by or on behalf of the ACO, or by ACO participants, or ACO providers/suppliers participating in the ACO, or by other individuals on behalf of the ACO or its participating providers and suppliers”.4

CMS states that if the above materials or activities are used “…to educate, solicit, notify, or contact Medicare beneficiaries or providers and suppliers regarding the ACO and its participation in the Shared Savings Program…”5 then they must be approved by CMS.


The proposed regulations provide ACO marketing guidelines. The potential for beneficiaries being misled about Medicare services available from an ACO or providers or suppliers is cited as the reason for these guidelines. Further, the proposed regulations state that ACOs, their providers and suppliers may mislead beneficiaries into thinking that the ACO is similar to a managed care organization6 and that beneficiaries must obtain their services from the ACO or ACO providers and suppliers.


The solution in the proposed regulation is for CMS to limit and monitor the use of beneficiary communications of ACO operations and functions as well as ACO marketing activities and materials by ACOs “ to ensure”7 (emphasis added) that the communications and “marketing by ACOs are used only for appropriate purposes”.

The regulations provide examples of “appropriate purposes”8 such as providing notice of ACO participation, CMS notices and provider or ACO terminations. The proposed regulations continue that this policy would be consistent with other Medicare programs. CMS has regulated other areas of marketing, for example, with regards to the Medicare Improvements for Patents and Providers Act of 2008 (MIPPA).9

Proposed Regulations

The proposed ACO marketing regulations provide: “… all ACO marketing materials, communications and activities related [to] the ACO and its participation in the Shared Savings Program, such as mailings, telephone calls or community events, that are used to educate, solicit, notify or contact Medicare beneficiaries or providers and suppliers regarding the ACO and its participation in the Shared Savings Program be approved by us before use …” (emphasis added). The marketing approval also includes ACO participants, providers/suppliers. CMS would also use this authority to ensure that the materials do not misrepresent the Medicare Shared Savings Program (MSSP) policies or suggest that CMS endorses a particular ACO or its participants or its providers/suppliers.

In addition to the above, CMS will review any changes to any previously approved materials.10 The penalty for not complying with these policies would result in a corrective action plan, or even termination of the ACO from the MSSP.

CMS also excludes certain information that would not be subject to its approval:

  1. Beneficiary communications that are informational;
  2. Beneficiary communications limited to a subset of beneficiaries;
  3. Materials that do not include information about the ACO or ACO providers;
  4. Materials that cover beneficiary specific claims issues or other specifics individual health related issues; and
  5. Educations issues on specific medical conditions or referrals.11


Despite the lack of direction in PPACA, CMS is attempting through the proposed regulations to restrict what ACO marketing will, or will not be allowed.12 The regulations would appear to create a significant burden for providers as well as CMS and will likely be a major concern as providers consider whether they wish to participate in the MSSP.


CMS Release 1345-P, 76 Fed Reg. 19528 (April 7, 2011).


76 Fed. Reg. at 19551.



Id. at 19551.



Id. at 19551.


Id. at 19551.



Id. at 19551.


Id. at 19551.


Id. at 19551.


CMS Release 4131-F, 76 Fed. Reg. at 54208 (2008). MIPPA amended titles XVIII and XIX of the Social Security Act amending various provisions of the Medicare Statute. Section 103 established new statutory prohibitions and limitations for Medicare Advantage Plans (MA) and Medicare Prescription Drug (PDP) Plans on certain sales and marketing activities. For example, MIPPA specifically prohibits any unsolicited means of direct contact with beneficiaries promoting or selling MA or PDP plans, cross selling of non-health related products and providing meals. It also prohibits sales and marketing activities in healthcare settings excluding common areas and at educational events. MIPPA limits the following: the scope of discussion during an appointment set with a beneficiary to discuss an MA plan or PDP is limited to what was agreed upon with the beneficiary in advance; the ability to use names and logos of co-branded network providers on plan membership and marketing materials; the value of gifts and promotional items provided to beneficiaries; and the compensation paid by plans to agents for selling MA and Part D products. Agents and brokers must be trained and tested. There are also MA marketing requirements before marketing materials can be distributed along with guidelines for certain MA organization marketing. Plans and CMS are to collaborate and share information with the states in advance. Section 42 CFR §422.2262 requires the review of marketing materials. Section 42 CFR §422.2264 sets forth the CMS guidelines for review of marketing materials for MA plans. Section 42 CFR §422.2266 provides for “deemed approval”. Part 423 of the CFR describes the Part D marketing requirements including guidelines for review, deemed approval, standards, licensing of marketing representatives and employer group retiree marketing.


76 Fed. Reg. at 19551.



Id. at 19551.


Sections 425.4 (Definitions), 425.5(4) (Marketing Materials), and 425.12 (Monitoring of Marketing).

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