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Future ACO growth opportunities

 

 

Paul Keckley looks at the future of Accountable Care Organizations in H&HN. Among his observations

  • “Care coordination across multiple sites of care vis á vis an ACO results in improved efficiency and outcomes.”
  • “The infrastructure, skill sets, care coordination processes and actuarial risk associated with ACOs is expensive and evolving. Organizations with large, multispecialty medical groups or networks that sponsor their own health plans or have experience in capitated contracts {have} fared best.”
  • “The expected increase in health spending to 6 percent annually for the next decade will prompt close attention to the effectiveness of ACOs as a vehicle for reducing cost. Physician-led organizations that adhere to care standardization and incentives for their clinicians linked to cost savings will be sustainable. Others will falter. And industry consolidation means ACO consolidation.”
  • ”The centerpiece for sustainable ACOs will be a comprehensive primary care network that integrates physical and behavioral health, pharmacy, dental, eye and nutrition services with heath coaches to change patient behavior. … From these primary care centric models, virtual ACOs that incorporate rural health and teleconnectivity, and clinical models that include social determinants of health in assessing risks and care coordination tactics will evolve.”
  • ”The MSSP likely will morph. Quality measures will change. The Shared Savings Program formula will be altered. Some MSSP ACOs will test shared savings with enrollees themselves, rewarding medication adherence or self-care management. CMS will simplify its reporting requirements to encourage continuity in the programs and seek to reduce attrition of participants. And attention to formulary design and medication management, post-acute care coordination, digital connectivity and self-monitoring and alternative health modes of care will become imperatives to achieving savings.”
  • ”Medicaid ACOs will be a growth opportunity. The shift of control from CMS to states via block grants or capitated payments will present an opportunity for ACOs, provided their primary and behavioral health capacity is adequate and actuarial risk assessment is precise going in.”

To read more, please hit this link.

 

 

 


Medicare ACOs seen gaining this year

 

Avalere Health, the  consulting firm, sees financial-risk-bearing Accountable Care Organizations gaining more traction and popularity this year. It says that “providers will feel increasingly comfortable with assuming financial risk in exchange for larger incentives” as more than 9 million Medicare beneficiaries are covered by a total of 480  (ACOs), including 99 new participants, in the Medicare Shared Savings Program (MSSP).

The number of ACOs participating in the Next Generation ACO Model launched by the CMS Innovation Center has more than doubled to 45 this year, from 17 in 2016..

Of the 525 ACOs serving Medicare beneficiaries, 87 are in risk-sharing arrangements that include bearing financial losses if certain cost targets aren’t reached.

Healthcare Dive noted: “Expansion of MSSP and growth in the number of risk-sharing ACOs is due in large part to the passage of MACRA, which is accelerating the trend toward value-based initiatives through the Quality Payment Program. So far, it seems that MSSP has been successful saving a total of $466 million in 2015 and more than $1.29 billion total since 2012.”

“As Congress considers health reform, there is some doubt surrounding the future of value-based initiatives like MSSP, which was established by the ACA. One reform floated by Republican leadership could be detrimental to progress made toward value-based care.”

“This approach would cause Medicare to function more like traditional markets, which would increase financial responsibility borne by beneficiaries and leave improvements to market forces rather than government regulators.”

To read the Avalere report, please hit this link.

To read the Healthcare Dive analysis, please hit this link.

 

 


Looking at the future evolution of the MSSP

evolve

In HealthcareDIVE,   Farzad Mostashari, M.D., and Travis Broome write about the continuing evolution of the Medicare Shared Savings Program. Dr. Mostashari is founder and CEO of Aledade Inc., where Mr. Broome is the lead policy person. Dr. Mostashari is the former national coordinator for health information technology at the U.S. Department of Health and Human Services.

”{M}ore investment and more fine-tuning will be required if we are to strengthen the MSSP and use it to help power the transformation of Medicare to a value-based system.

”First, CMS needs to tailor the risk for MSSP ACOs so that it is enough to motivate, but not sink a small practice. It’s critical that the risk small practices take on bears some relationship to the financial resources of the ACO and its members. If it’s too much so that a bad year that happens because of an external event – such as an epidemic or disaster – can sink even the most well-intentioned practice, then no one will enter into an ACO arrangement.”

“”Second, we need an accurate way to measure whether or not an MSSP ACO creates value. The best way to do that is through a difference-in-difference approach. In this, the key question asked is: Did a Medicare beneficiary get better care at lower cost in the ACO than if that same Medicare beneficiary had not been in the ACO? To get closer to this difference-in-difference approach, CMS needs to move away from national inflation updates and artificial risk-scoring methodologies to regional inflation updates and direct risk scoring.”

”Third, CMS should continue to seek to simplify the program. For example, while we appreciate the work that was done in Track 1+, it is quite possible all of the same benefits could have been accomplished by adding just a few lines of changes to Track 2 without the need to create a whole new track. This would have been both simpler and created a better business case for physicians to move towards risk.”

To read more, please hit this link.


The most alluring ACO model

In this HealthAffairs post, the authors argue that today’s most attractive national Accountable Care Organization model is offered by CMS.

They write:

“Fortunately, CMS heard the complaints about early MSSP  {Medicare Shared Savings Program} models and addressed the majority of them through the progressive structure of the Next Gen {of ACOs} model. In fact, the core difference between MSSP Track 1 and the current Next Gen model is that the latter is based upon extensive feedback from health systems regarding their concerns about MSSP Track 1.

“Next Gen is therefore a program that health systems have directly asked for. The model still has room for further improvement — for example, Next Gen ACOs should have access to the full toolkit of benefit- and network-design strategies found in Medicare Advantage and other provider-led offerings. But the CMMI {Center for Medicare & Medicaid Innovation} leadership has pledged to pursue additional features that could take effect in the later years of the Next Gen model, and will continue the virtuous cycle of improvements.”


Experts applaud ‘Next Generation’ ACO’s

 

applause

Experts applauded the Centers for Medicare & Medicaid Services’ “Next Generation” Accountable Care Organization (ACO) plan, which asks participants to take on more financial risk in return for more  potential reward. The aim is to move away from fee for service to capitation as payers push healthcare industry toward a value-based reimbursement system.

“It’s a real effort to move away from shared savings or limited risk models. On both counts it’s an important step,” said Mark McClellan, M.D., a former CMS administrator,  told FierceHealthcare.

Larry Kocot,  a visiting fellow in the economic-studies program at the Brookings Institution, agreed. “I do think CMS should be credited for thinking creatively to extend the model to meet the needs of providers no matter what stage they are at within the ACO program,” he told the news service.

Farzad Mostashari, M.D., former national coordinator for health- information technology, told Clinical Psychiatry News Digital Network that the new model will likely suggest how CMS will structure other ACO’s.  “This is directionally, absolutely where the Medicare Shared Savings Program (MSSP) is headed.”

“We are hopeful the changes they proposed and the comments received that they will make the MSSP program more accessible and more friendly to a number of providers,” said Kocot, who also served as a senior administrator of CMS.

FierceHealthcare reported that Kocot said he’d like the CMS to establish a ”fourth track that would lead to full capitation. He recommends tracks that reflect a continuum of ACOs that may begin with little risk and end with the full capitation model.”


Southern hospitals doing best with MSSP

 

Some early evidence reported in HealthAffairs indicated that geography, not size, is the key factor in success among Accountable Care Organizations of  participating in the Medicare Shared Savings Program.

In any event, of course, there will have to be more changes in the program for it to fulfill its creators’ hopes for hospitals across America

Fierce Healthcare summarized: ”The size of the ACO didn’t necessarily determine its likelihood of producing savings, as large ACOs ‘generally did not have an advantage in financial performance compared to smaller ACOs,’ according to the article.”

ACOs in the South outperformed  other regions’, and those in expensive areas were particularly successful in producing savings. The HealthAffairs study reported that “the way medicine is practiced (or at least has been practiced) in a region is important to the ACO’s ability to generate shared savings under current benchmarking methodology.”

”Financial performance, though, is only one part of ACOs’ overall mission, and the first HealthAffairs analysis notes that the savings produced by MSSP ACOs is not necessarily related to how they were able to improve the quality of care. ”

 

 


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