When Is an Accountable Care Organization a Monopoly?

One of the biggest challenges of the federal government’s encouragement of providers forming accountable care organizations (ACOs) is how to prevent these partnerships from taking over a marketplace, driving out competitors and driving up prices.

Last week the Department of Justice and the Federal Trade Commission issued a summary of questions the agencies have fielded since March 2011 and the answers rendered regarding anti-trust guidelines related to forming ACOs. In all the federal agencies have responded to 33 queries.

The federal government employs a tool called a primary service area (PSA) share calculation to help potential ACOs establish the boundaries of what activities will be or won’t be permitted under federal anti-monopoly laws. While ACOs are not required to calculate PSA shares, they are encouraged to do so. The FAQ contains links to resources on federal websites to help potential ACOs develop their own PSA share calculation.