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CMS Releases MSSP Track 1+ Model Risk Structures, Eligibility

CMS provided MSSP Track 1+ model details, including financial risk structures based on ACO composition and eligibility requirements.

A new Medicare Shared Savings Program Track 1+ fact sheet discusses model details, including risk structures and eligibility requirements

Source: Thinkstock

- In a new Medicare Shared Savings Program (MSSP) Track 1+ fact sheet, CMS clarified model details for 2018 to 2020 participation, including maximum shared savings and losses rates, risk assignments, and eligibility requirements.

CMS announced the MSSP Track 1+ model in December 2016 as a new accountable care organization (ACO) model with a limited downside financial risk. Based on stakeholder feedback on the final MACRA implementation rule, CMS designed the new MSSP track to expand Advanced Alternative Payment Model (APM) options under the Quality Payment Program, especially for small and rural practices.

As part of its goal to develop more small and rural hospital-friendly Advanced APM options, the federal agency developed a MSSP track that blends Track 1 and Track 3 elements. While the ACO model is largely built on MSSP Track 1, the MSSP Track 1+ will include Track 3 elements, such as prospective beneficiary assignment, gradual downside risk implementation, and optional skilled nursing facility 3-day rule waivers.

In terms of shared savings and losses, CMS clarified that MSSP Track 1+ ACOs will have a maximum 50 percent shared savings rate depending on quality performance. The track will also have a fixed 30 percent shared losses rate.

However, participants will be offered symmetrical minimum shared savings and losses rates. MSSP Track 1+ ACOs will be able to choose from zero percent minimum rates, symmetrical rates in 0.5 percent increments between 0.5 and 2 percent, and symmetrical rates based on number of assigned beneficiaries.

Additionally, CMS elaborated on ACO financial risk assignments under the MSSP Track 1+ model, which will be based on ACO composition.

“[T]he maximum level of downside risk would vary based on the composition of ACOs, with lower levels of risk potentially available to qualifying physician-only ACOs and/or ACOs that include small rural hospitals,” the federal agency explained.

MSSP Track 1+ ACOs will be placed in either a revenue or benchmark-based financial risk structure depending on the following criteria:

• The ACO contains a participant (as defined by Taxpayer Identification Numbers or CMS Certification Numbers) that is in part or wholly owned or operated by a hospital under the Medicare inpatient prospective payment system, cancer center, or rural hospital with over 100 beds

• The ACO includes a participant that is in part or wholly owned and operated by a rural hospital with 100 or fewer beds that is not itself included as an ACO member

• The ACO has a rural hospital participant with 100 or fewer beds that is in part or wholly owned or operated by a health system

If a MSSP Track 1+ ACO does not meet any of the criteria, then the ACO’s loss sharing limit will be revenue-based. For the first year, the limit will be 8 percent of the ACO participant Medicare fee-for-service revenue, including total Parts A and B fee-for-service revenue for participants that are rural hospitals with 100 or fewer beds.

The risk assignment for the first year will align with risk requirements for Advanced APM participation in 2018. But the loss sharing limit may not be enough for MSSP Track 1+ ACOs to earn Advanced APM status after 2018.

Therefore, CMS will offer revenue-based MSSP Track 1+ participants the option to accept higher financial risk in 2019 and 2020. But only if the Advanced APM nominal risk requirement for revenue standard increases beyond 8 percent of APM entity revenues. Participants must take on additional revenue-based financial risk to continue Advanced APM participation.

After 2020, CMS explained that loss sharing limits will follow the required nominal amounts for Advanced APM participation, but downside financial risk will still be limited.

“If the loss limit, as a percentage of ACO participants’ FFS [fee-for-service] revenue exceeds the amount that is 4 percent of the ACO’s updated historical benchmark, then the loss limit would be capped and set at 4 percent of the updated historical benchmark,” added the federal agency.

On the other hand, MSSP Track 1+ ACOs that meet at least one of the criteria will be assigned to a benchmark-based financial risk structure. The loss sharing limit will be 4 percent of the ACO’s most recent historical benchmark.

CMS noted that the benchmark-based arrangement may contain greater financial risk levels than the revenue-based arrangement. The risk could be higher because the ACOs are more likely to be “providing a larger portion of total Part A and B revenue for their Medicare FFS beneficiaries and therefore likely to be more able to assume a higher level of risk.”

However, the benchmark-based financial risk structure will be lower than Tracks 2 and 3 risk assignments. The loss shared savings limit in Track 3 is 15 percent of the ACO’s updated historical benchmark, while the loss limit is phased in under Track 2, starting with 5 percent of the ACO’s updated historical benchmark in the first year, 7.5 percent in the second year, and 10 percent in the third and subsequent years.

The federal agency will determine a participant’s risk assignment at the start of an ACO’s agreement period and reassign the risk structures each year.

“Changes to the loss sharing limit (to the revenue- or benchmark-based methodology) would be made by CMS based on the annual certification process that occurs prior to the start of a performance year under the Model,” wrote CMS. “The Track 1+ ACO’s loss sharing limit could be adjusted up or down on this basis.”

Additionally, CMS elucidated eligibility requirements for MSSP Track 1+ participation. The new MSSP track will be available to Track 1 ACOs that are within their agreement period, new MSSP applicants, and Track 1 ACOs that are renewing their participation agreement and meet Track 1+ requirements.

For new MSSP applicants and ACOs renewing their participation agreement, ACOs will need to complete the annual MSSP application process. Although, all interested ACOs will also need to complete an additional application process specific to the new model, which will notably require proof that the ACO has an adequate repayment mechanism.

ACOs that are not eligible for participation include MSSP Tracks 2 and 3 ACOs, Pioneer Model participants, and Next Generation Model ACOs.

CMS will also limit MSSP Track 1+ participation to one three-year agreement period. The federal agency capped participation to ensure that ACOs are gradually taking on more downside financial risk.

“New entrants and renewing ACOs could enter one, three-year agreement period under the Model, and ACOs that transition to the Model during their existing Track 1 agreement period could have the opportunity to renew for a subsequent three-year agreement under the Model,” CMS explained.

The MSSP Track 1+ model is scheduled to launch in 2018, but CMS intends to start the application process in May 2017.

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