Major healthcare groups question Medicare ACO proposal

Les Masterson

Sept. 24, 2018

Dive Brief:

• Nine organizations sent a letter to CMS Administrator Seema Verma to voice concerns about proposed changes to the Medicare Shared Savings Program (MSSP), the agency's largest alternative payment model. 
• The groups support some of the proposed changes, including improvements to value-based contracting and lowering regulatory burden. However, they oppose forcing providers to take on risk in two years rather than six years and decreasing the proposed shared savings rate from 50% to 25%.
• The organizations said CMS should instead allow accountable care organizations to have more time in a shared-savings only model and give shared savings of at least 50%.

Dive Insight:

MSSP has been under a spotlight lately with the proposed changes. Reports have shown savings, but not necessarily as much as initially expected. The regulatory push toward more risk reflects a desire for providers to commit to value-based contracting despite the potential for financial loss. Another recent study, however, found that nearly three-fourths of ACOs would leave MSSP if forced to take on risk the next year.

The program includes 561 ACOs that cover 10.5 million Medicare beneficiaries. CMS data show the program saved a net $314 million to the Medicare Trust Fund in 2017. That year, more than 90% of MSSP ACOs took part in track one, which doesn't require any financial risk. The rest were in tracks two or three, where they can share savings or repay Medicare losses based on financial performance. CMS would like more providers in the latter tracks.

The letter, which was signed by groups including America's Essential Hospitals, America's Health Insurance Plans and the Medical Group Management Association, said ACOs have been key to shifting from fee-for-service to value-based care. These changes take time for providers to implement, they added.

"ACOs are investing millions of dollars of their own capital to make these care improvements, even though Medicare does not recognize these start-up and ongoing investments in its calculations of ACO savings, losses and costs. Further, the benefits of these transformations extend beyond the ACO's attributed Medicare fee-for-service patient population and have a broader effect on Medicare Advantage beneficiaries and even patient populations beyond Medicare," they wrote.

The letter said the proposed rule does provide more stability and predictability, including longer agreement periods and increased beneficiary engagement. However, the groups don't support other changes, which they think will drive ACOs away from MSSP.

"The MSSP remains a voluntary program, and it's essential to have the right balance of risk and reward to continue program growth and success. Program changes that deter new entrants would shut off a pipeline of beginner ACOs that should be encouraged to embark on the journey to value, which is a long-standing bipartisan goal of the administration and Congress and important aspect of the Quality Payment Program," they wrote. 

https://www.healthcaredive.com/news/major-healthcare-groups-question-medicare-aco-proposal/532986/