CMS Offers More Incentives in Shared Savings Program

CMS (Centers for Medicare & Medicaid Services) just updated rules governing how providers, such as ACOs, (Accountable Care Organizations) can get their share of the Medicare Shared Savings Program.

The new rule creates a new Track 3, which includes, according to the agency, higher rates of shared savings, the prospective assignment of beneficiaries, and the opportunity to use new care coordination tools. There is also a streamlining of data sharing between CMS and ACOs.

There are currently over 400 participating ACOs serving more than 7 million beneficiaries. In the first two years of the program established under Obamacare, the ACO’s improved performance in 30 or 33 quality measure and generated over $384 million in savings to Medicare. That’s about $300 per participant in the program.

“Accountable Care Organizations have shown early but exciting progress in improving quality of care, while providing more patient-centered care at a lower cost, ” said CMS Acting Administrator Andy Slavitt. “The ACO rules today strengthen our ability to reward better care and lay the groundwork for more providers to become successful ACOs.”

Higher Risk, Higher Rewards

The National Association of ACOs (NAACOS) said CMS is to be commended for adopting some “important improvements to the program, especially for the new high risk Track 3.” The most significant change from current rules for Track 1, according to the association, is that the ACOs whose contract is ending this year and achieved certain quality thresholds will be permitted to sign a new three-year agreement and if they were successful in lowering their costs and achieving savings, their new historically based benchmarks will be adjusted upwards to include their savings amount.

“This will partially mitigate the spiraling down of benchmarks for the successful ACOs. We are very pleased CMS has adopted these changes to give the 200+ ACO whose contracts are ending an option to continue in the program. We are also very pleased that CMS will consider for the future, trending and resetting benchmarks based on regional costs. This was one of our strongest recommendations and we still hope it could be implemented in 2017 for all ACOs.”

Track 3 will have better savings share, and in 2017, SNF 3-day waiver, Telehealth waivers and self-attestation/alignment of beneficiaries. NAACOS and other stakeholders strongly recommended these changes.

ACO Association Skeptical

But ACOs weren’t totally happy.

The association is “very disappointed” that many of their recommendations were not adopted for the majority (400+) of ACOs in the lower one-sided risk Track 1. “While CMS made several other changes in how beneficiaries are assigned to the ACO and data is shared, the remainder of the program policies will not change for at least 2016 and probably 2017.”

The association was also disappointed that CMS is not implementing a voluntary beneficiary assignment policy or a two-way risk adjustment methodology for the Track 1 ACOs.

For the program to succeed there must first be a sustainable business model for the one-sided track, noted the NAACOS statement. “Most providers will not migrate to a higher two-sided risk track without a positive experience in a one-sided risk program. It would appear that CMS is hoping that by building the better business case for the higher risk tracks more ACOs will come.”

“I remain skeptical that enough improvements have been made to Track 1 to sustain the growth we have been seeing and am concerned that large numbers of current ACOs are not ready to take on the higher risks of Track 2, 3 or CMMI’s Next Generation ACO program”, said NAACOS CEO Clif Gaus. NAACOS believes that ACOs continue to be the most promising market-based solution to improving quality and lowering healthcare cost growth and will continue to work with the Administration and the Congress to make further adjustments to the program so that more Medicare beneficiaries and providers are able to participate and benefit from the program’s success.”

For more information on the Medicare Shared Savings Program, click here.