IRS Seeks Comments on Participation in New Medicare Savings Program

The Affordable Care Act created a Medicare shared savings program (“MSSP”), which certain exempt organizations may participate in through an accountable care organization. This program would allow participating accountable care organizations that meet quality performance standards and demonstrate savings to receive MSSP payments, in addition to fee-for-service payments. However, the new program raises issues for exempt organizations around private benefit, private inurement and unrelated business taxable income. The IRS is seeking comments on whether existing guidance relating to the tax code provisions dealing with exempt organizations is sufficient, or if additional guidance is needed to address these issues. Comments should be submitted by May 31, 2011. See Notice 2011-20 for more information.