More flexibility is coming for Medicare accountable care organizations under a final rule the CMS published Thursday (PDF). The revisions are intended to strike a balance between maintaining the program’s rigor and making sure providers continue to participate.
The Medicare Shared Savings Program will offer a new track to take on more financial risk of patient care, and it will allow Medicare ACOs to avoid penalties beyond the initial three-year term. The CMS will also issue future guidance on benchmarking and rebasing issues that have been sources of contention for many providers.
The Affordable Care Act catalyzed the creation of Medicare ACOs, which are networks of hospitals and physicians that aim to improve the quality and lower the cost of care for Medicare beneficiaries in a defined area. More than 400 ACOs participate in Medicare accountable care contracts, and they care for more than 7 million beneficiaries.
The CMS received 275 comments from concerned stakeholders, and the agency expects 90% of Medicare Shared Savings ACOs will stay with the program because of the rule changes.
Hospitals and physicians have been able to choose between two tracks for shared savings for ACOs, and the CMS is finalizing the third option it proposed in December. The third track is “very much modeled” after the Pioneer ACO, CMS Deputy Administrator Sean Cavanaugh said. And it also shares many similarities with the Next Generation ACO model that the CMS proposed in March.
Providers opting into track three will take on more financial risk, but could also share in potentially higher savings. The CMS said upside and downside risk for this model will be 75%—meaning an ACO’s bonus or penalty would be 75% of its savings or loss— just as it proposed in December. ACOs in track three are also given a fixed population of beneficiaries to care for.
Read the full report here.
Contact Steven G. Cosby, MHSA, Group Health Insurance Broker and Agent with Cosby Insurance Group, with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.
