Health Care Groups Seek Additional Changes to CMS’ ACO Program
More than 30 health care organizations in a joint letter to CMS questioned whether proposed changes to the Medicare Shared Savings Program would provide sufficient flexibility and incentives to encourage providers to participate in the program, Modern Healthcare reports (Evans, Modern Healthcare, 2/8).
CMS in December 2014 released a proposed rule that would give MSSP participants an additional three years before imposing penalties. Under existing MSSP rules -- which were adopted in 2011 -- accountable care organizations face penalties after the first three years in the program unless they volunteer to take on downside financial risk earlier in exchange for larger potential bonuses for meeting the program's goals. In addition, the agency proposed a third track for ACOs that would allow them to retain up to 75% of what they save but also be responsible for up to 75% of their losses. The proposed changes aim to discourage participants from dropping out of MSSP (California Healthline, 12/2/14). The comment period on the proposed rule closed on Friday (Modern Healthcare, 2/8).
Meanwhile, last month HHS announced that it will seek to make 30% of Medicare payments for hospitals and physicians through alternate payment models like accountable care organizations and bundled payments by 2016 (California Healthline, 1/27).
Details of Joint Letter
The letter was signed by several health care organizations, including:
- The American Hospital Association;
- The American Medical Association;
- Trinity Health; and
- Universal American (Modern Healthcare, 2/8).
The groups wrote, "We share CMS' concern that the current required transition from one- to two-sided risk may be too soon and too steep for many ACOs, requiring organizations to choose between taking on more risk or exiting the program" (Young, CQ HealthBeat, 2/6).
The groups offered several recommendations to CMS for improving the program beyond what was detailed in the proposed rule, including:
- Allowing top performers on quality measures to receive additional bonuses;
- Having CMS assign patients to ACOs at the beginning of the year and not retroactively revise patient assignments when the well being of such patients is tied to ACO performance measures;
- Making it less difficult for ACOs to obtain bonuses; and
- Providing ACOs with additional flexibility to choose between the two types of savings thresholds prior to ACOs being able to obtain bonuses.
In addition, the groups wrote that ACOs that delay taking on downside risk should not receive smaller bonuses of as a result (Modern Healthcare, 2/8). They wrote, "Given the ACOs' levels of investment, and the fact that only a quarter have experienced shared savings, it is unnecessarily punitive to decrease the savings rate from 50% to 40% in the second agreement period" (CQ HealthBeat, 2/6). They added, "If anything, 50% is too low to incentivize the care change that will lead to success."
Further, the groups praised the idea of allowing a third track for ACOs that would allow for larger potential bonuses if the organizations also took on more risk. However, they suggested that CMS could also allow such organizations to have the option of operating under a global payment system.
Meanwhile, in a separate letter, AHA wrote that while the proposed rule would improve MSSP overall, the organization said it might not "go far enough to correct misguided design elements that emphasize penalties rather than rewards" (Modern Healthcare, 2/8).
In addition, AHA wrote that it is "concerned that the agency’s proposed approach does not provide an adequate glide path for those who are not yet prepared to take on increased risk but are working toward doing so."
AHA added, "CMS should do more to encourage sustained program participation among current ACOs, which have invested significant resources in the development of infrastructure and the redesign of care processes, especially those that need more time to gain experience in the program before moving to two-sided risk" (AHA letter, 2/5).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.