Accountable care organizations (ACOs) participating the Medicare Shared Savings Program (MSSP) will begin operating under some new rules designed to incentivize participation in the program while continuing the Centers for Medicare and Medicaid’s (CMS) evolution toward value-based payment.
Under the new rule, ACOs that sign up for a second or subsequent contract period will be subject to a benchmarking process based on regional rather than national spending data—a move aimed at acknowledging the fact that health care costs aren’t the same across the country. Also, so-called Track 1 ACOs (which share in savings but are not responsible for losses) that are approved for renewal will be allowed more time to transition to a risk-based Track 2 or 3 model by way of a 1-year deferment.
The rule also sets up a 4-year window for appeals and reopenings of reviews of savings or losses—the first time CMS has offered specifics on the process.
The Medicare “Pioneer” program that targets more sophisticated health systems to foster the development of accountable care organizations (ACOs) has now lost about 40% of the systems that signed on initially. According to an article in Modern Healthcare (access available via free one-time registration) the most recent withdrawals “suggest even the most sophisticated health systems may be unwilling to take losses as policymakers test new payment and delivery models.”
The most recent exits—Franciscan Alliance, Genesys PHO, and Renaissance Health Network—bring the Pioneer list from its original 32 members to 19. The Modern Healthcare article reports that 9 of the 13 ACOs that dropped out did so within the first year of the program’s launch in 2012, opting instead to join the “less risky” shared savings program, the traditional Medicare program that allows other entities to form ACO. Unlike the Pioneer program, the number of entities joining the shared savings program has been steadily increasing.
Though it contains no formal recommendations, the Medicare Payment Advisory Commission’s (MedPAC) June report describes the commission’s exploration into the possibility of future changes in several areas, including the idea of paying the same rates to inpatient rehabilitation facilities (IRFs) as are paid to skilled nursing facilities (SNFs) for some types of postacute care. The report was the subject of a June 18 hearing of the House Ways and Means Committee’s Health Subcommittee.
The MedPac report, released June 13, is focused on 7 areas: bringing payments in line across fee-for-service, Medicare Advantage, and accountable care organizations (ACOs); measuring quality of care in Medicare; improving risk adjustments; financial assistance for low-income beneficiaries; per-beneficiary payment for primary care; measuring the effects of medication adherence for the Medicare population; and payment differences across postacute settings.
Early news on savings achieved by Accountable Care Organizations (ACOs) is out, and it’s mostly good: According to a study just released by the US Centers for Medicare and Medicaid Services (CMS), almost half of the ACOs started in 2012 were already reporting significantly lower-than-projected expenditures in their first year.
Of the 114 ACOs that began operations in 2012, 54 reported exceeding program benchmarks, and 29 of the 54 “generated shared savings totaling more than $126 million,” according to a press release issued by CMS. These ACOs were also cited as helping to create $128 million in net savings for the Medicare Trust Funds.