CMS rule to overhaul Medicare Shared Savings Program would imperil ACOs, group says

The National Association of ACOs (NAACOS) argues that a rule proposed by the Centers for Medicare and Medicaid Services (CMS) to overhaul the Medicare Shared Savings Program (MSSP) begun in 2012 under the Affordable Care Act would create havoc by “introducing many untested and troubling policies.”
“The administration’s proposed changes to the ACO program will halt transformation to a higher quality, more affordable, patient-centered health care industry, stunting efforts to improve and coordinate care for millions of Medicare beneficiaries,” NAACOS President and CEO Clif Gaus said in a statement Friday.
Announced late Thursday, the CMS proposed rule would shift financial risk to ACOs from the Medicare program. The federal agency said its new program, called Pathways to Success, would encourage greater accountability among ACOs.
“Despite the program’s intent, the Shared Savings Program has shown increases in net spending for CMS and taxpayers, in part because the majority of ACOs – 460 of the 561, or 82% of all ACOs in the Shared Savings Program in 2018 – are not taking on risk for increases in costs,” CMS said. “Data on ACO performance to date has shown that ACOs that are not at risk for cost increases end up increasing Medicare spending in aggregate.”
CMS said Pathways to Success is designed to advance five goals: Accountability, Competition, Engagement, Integrity, and Quality. The agency estimated the program would save Medicare $2.2 billion over 10 years.
“After six years of experience, the time has come to put real ‘accountability’ in Accountable Care Organizations,” CMS Administrator Seema Verma said. “ACOs can be an important component of a system that increases the quality of care while decreasing costs; however, most Medicare ACOs do not currently face any financial consequences when costs go up, and this has to change.”
Under the proposed rule, CMS would shorten the time an ACO can remain in a shared savings-only model from six years to two years. Currently, MSSP Track 1 ACOs share savings with the government if they meet certain quality and other targets; however, these ACOs are not at risk for increased Medicare spending for patient care.
“This one-sided model allows ACOs to invest in infrastructure and other changes to improve care delivery without fear of suffering financial losses beyond their own investments,” NAACOS said. “Track 1 is where the vast majority of ACOs begin, and ACOs with more experience managing financial risk can participate in a two-sided risk model, where they share in savings but also are liable for a portion of spending.”
Rather than “forcing ACOs to assume risk too soon,” NAACOS said, CMS should “modernize the Medicare ACO program by improving program policies and creating accurate benchmarks that truly reflect ACO performance.”
You can view the proposed rule here.