Smaller, physician-led accountable care organizations (ACOs) need more governmental support to succeed under the latest regulations of the Medicare Shared Savings Program (MSSP), a group of experts at the Duke-Margolis Health Policy Center said in a new report.
In its Pathways to Success program, which went into effect last year, the Centers for Medicare and Medicaid Services (CMS) requires ACOs to move toward taking downside financial risk more quickly than in the old MSSP model.
The problem is that most ACOs in the program have taken only upside risk, which allows them to share in Medicare savings without having to share in losses if they exceed a benchmark for total cost of care. Far more infrastructure, expertise, and capital are required to take downside risk, and not all ACOs are up to the task, according to the researchers.
As of July 2019, the report said, there were about 246 physician-led ACOs in the MSSP, representing 45% of those participating in the program. To date, physician-led and small ACOs have been more likely than hospital-led and larger ACOs to achieve savings while providing high-quality care.
Physician-led ACOs are as likely to take on downside risk as other types of ACOs. But they have also exited the MSSP at higher rates than other ACOs, partly due to concerns about greater financial risk.
More Time Needed
To find out how these ACOs were responding to Pathways to Success, the Duke researchers interviewed five ACO leaders and two executives of “ACO enablers.” These are outside firms, such as Aledade, Caravan, and Evolent, that give ACOs upfront capital and technical assistance, including care management support, access to information technology infrastructure, and data analytic support.
Several of the ACO leaders cited the importance of the ACO Investment Model, a CMS program that provided advanced shared savings to supply capital to fledgling ACOs. Unfortunately, CMS has discontinued this program, the report noted.
In the MSSP overhaul, CMS recognized that physician-led ACOs would need a longer transition period to taking downside risk than other ACOs because of their lack of capital and limited infrastructure.
Due to the difficulty of identifying physician-led ACOs, CMS used revenue status as a proxy. It gave inexperienced, “low-revenue” ACOs a transition period of up to 3 years compared with up to 2 years for other ACOs. But not all physician-led ACOs have low revenues.
Another MSSP policy change that could help physician-led ACOs is the new methodology for calculating the limits on shared losses. In Pathways to Success, ACOs can start out in the basic track, which includes five levels, and migrate to the enhanced track.
The first two basic levels entail upside risk only, while levels C, D, and E require ACOs to take ascending levels of two-sided risk. The enhanced track provides a still higher level of risk.
To protect small ACOs that could get wiped out by large losses, CMS gave them the option of basing their maximum loss on the lesser of a percentage of the total cost of care, known as the benchmark, or a percentage of their annual revenue from the MSSP.
While their upside would generally still be the same, an ACO with low revenue would have less or similar downside exposure if it based its shared losses on that revenue instead of the benchmark, William Bleser, managing associate of the Duke-Margolis Center, told Medscape Medical News.
In addition, CMS is allowing smaller ACOs to participate in the two-sided risk tracks with less capital reserves than were formerly required, the report stated. Under prior rules, CMS set this amount at one percent of an ACO’s benchmark, which was a significant challenge to smaller ACOs. Pathways to Success reduced this amount by calculating the repayment of losses to CMS as a percentage of revenue rather than of the benchmark.
Other Strategies Needed
Nevertheless, the researchers said, “these efforts to mitigate increased risk exposure may not offer enough security for physician-led…ACOs to participate [in the MSSP].”
Upfront capital to hire care coordinators, a slower transition to risk, and CMS-convened learning collaboratives would all make the program more attractive to small, physician-led ACOs, they said.
While the report didn’t say how long the transition period should be, Bleser said that other Duke-Margolis research indicates that a minimum of 3 years may be needed to stabilize participation in a two-sided risk program.
Moreover, the researchers noted, a softer transition is required from the basic to the enhanced tracks. When an ACO moves from basic level E to enhanced, Bleser noted, the percentage of shared savings it can get doubles from 10% to 20% of the ACO’s benchmark.
But the shared losses rise much faster. In basic level E, they’re either 4% of the benchmark or 8% of revenue. In the enhanced track, the ACO can lose up to 15% of the benchmark. So, the downside increases much more than the upside in CMS’s discontinuous scheme.
MSSP ACOs would also benefit, the report stated, if CMS provided timelier performance data and feedback reports. This has been a complaint of many ACOs, and it magnifies the challenge of having only 2 years to start taking downside risk, Bleser said.
After the first year in the MSSP, he notes, it might be 6 months before an ACO starts seeing CMS performance data. At that point, the ACO has been in the program for 18 months, and it has to decide whether to take downside risk by the end of the second year.
“That can be a little scary,” he points out.
For more news, follow Medscape on Facebook, Twitter, Instagram, and YouTube.
Publish date : 2020-02-15 00:45:30