Policy & Regulation News

CMS Announces Next Generation ACO Model Initiative

By Jacqueline DiChiara

- The Department of Health and Human Services (HHS) has announced its latest initiative for the Centers for Medicare & Medicaid Services’ Innovation Center (CMS Innovation Center), the Next Generation Accountable Care Organization (ACO) Model Initiative, focused on an original accountable care opportunity designed to achieve the utmost quality care standards.

The Next Generation ACO Model of payment and care delivery, which stems from involvement with the Pioneer ACO Model and the Medicare Shared Savings Program (Shared Savings Program), involves three initial performance years and two optional one-year extensions, says CMS.

The model supports patient-centered care by allowing beneficiaries to confirm a care relationship with ACO providers and encourages direct communication regarding care preferences.

According to the federal agency, the model’s overall purpose is “to test whether strong financial incentives for ACOs, coupled with tools to support better patient engagement and care management, can improve health outcomes and lower expenditures for Original Medicare fee-for-service (FFS) beneficiaries.”

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  • This proposal will establish predictable financial targets and enable providers and beneficiaries with extensive opportunities to coordinate care.

    “This ACO model responds to stakeholder requests for the next stage of the ACO model that enables greater engagement of beneficiaries, a more predictable, prospective financial model, and the flexibility to utilize additional tools to coordinate care for beneficiaries,” said Patrick Conway, Deputy Administrator for Innovation and Quality and Chief Medical Officer for CMS.

    Although the model’s ACOs will bear more substantial performance risk than currently established ACOs, it will potentially result in increased savings.

    To support this increased risk, ACOs’s relatively stable benchmark and accommodating payment options strengthen ACO investments in a care improvement infrastructure where patients receive high quality care.

    “This model is part of our larger effort to set clear, measurable goals and a timeline to move the Medicare program — and the health care system at large — toward paying providers based on the quality, rather than the quantity of care they give patients,” said HHS Secretary Sylvia M. Burwell.

    Burwell additionally stated the model is a vital step towards a collective progression where models of care compensate value over volume in care delivery.

    The new model additionally promotes extensive coordination and more intimate care relationships between ACO providers and beneficiaries.

    A plethora of available resources will allow ACOs to advance their beneficiaries’ coordination of care. Additionally, beneficiaries who receive care from ACOs may receive rewards.

    CMS expects 15 to 20 ACOs will take part in the Next Generation ACO Model with representation from an assortment of provider organization types and geographic regions.