- CMS recently finalized an overhaul of the Medicare Shared Savings Program (MSSP), which will require accountable care organizations (ACOs) to assume downside financial risk sooner.
The MSSP is the largest Medicare ACO program, boasting 561 organizations serving 10.5 million Medicare fee-for-service beneficiaries. The program allows ACOs to gradually take on downside financial risk through four tracks.
But the program is about to drastically change starting July 1, 2019. In a new final rule, CMS finalized the Pathways to Success initiative. The initiative will replace the MSSP.
“Pathways to Success is a bold step towards quality healthcare at a lower cost through competition and beneficiary engagement,” CMS Administrator Seema Verma stated in a press release. “The rule strikes a balance between encouraging participation in the ACO program and advancing the transition to value, ultimately protecting taxpayers and patients. Medicare can no longer afford to support programs with weak incentives that do not deliver value. As we structure new payment arrangements, the impact on the overall market will be top of mind.”
The recently finalized Medicare ACO program will advance the transition to value by reducing the amount of time that an ACO can remain in a track without downside financial risk, or repayment of final losses.
Pathways to Success will decrease the amount of time an ACO can stay in an upside-only track from six years to two years for new ACO participants and three years for new, low-revenue ACOs, which will include physician-led organizations and some rural organizations.
The final rule will also offer greater potential for reward by providing higher shared savings rates for ACOs transitions to greater levels of financial risk.
The shared savings rate for ACOs in the upside-only model will be up to 40 percent based on quality performance and other eligibility criteria. The finalized policy increased the potential reward from 25 percent in the proposed rule.
ACOs in performance-based tracks with downside financial risk will face a shared savings rate of up to 50 percent based on quality performance and other eligibility criteria.
Pathways to Success will also change care quality and beneficiary engagement rules for Medicare ACOs. CMS announced that Pathways to Success will expand coverage of high-quality telehealth services, including telehealth services provided in a patient’s home.
The new ACO program will also expand the skilled nursing facility three-day rule waiver eligibility and allow ACOs to choose prospective beneficiary assignment on a yearly basis.
In terms of beneficiary engagement, the program will allow ACOs to offer incentive payments to beneficiaries for their efforts to improve their own health outcomes. For example, ACOs could offer incentives for a patient seeking primary care services and necessary follow-up.
However, only ACOs in performance-based tracks with downside financial risk will be able to take advantage of the care quality and beneficiary engagement flexibilities.
Additionally, CMS finalized updated the benchmarking methodology for Pathways to Success. The new program will incorporate different amounts of ACO historical experience and regional performance data depending on the organization’s agreement period.
“The redesign of the program will provide for more accurate benchmarks for ACOs,” CMS stated in a fact sheet. “These benchmarks will protect the Trust Funds by ensuring that ACOs do not unduly benefit from any one aspect of the benchmark calculations, while also helping to ensure the program continues to remain attractive to ACOs, especially those caring for the most complex and highest risk patients who could benefit from high-quality, coordinated care from an ACO.”
CMS plans to open an application cycle for the new Medicare ACO program on July 1, 2019.
“This avoids an interruption in participation by ACOs with a participation agreement ending on December 31, 2018, that elected to extend their current agreement period for an additional six-month performance year and apply for a new agreement period beginning on July 1, 2019,” the federal agency explained.