Most accountable care organizations taking on downside risk in the Medicare Shared Savings Program are considering dropping out due to concerns they will suffer financial losses in response to the COVID-19 pandemic, according to a new survey.
Fifty-six percent of risk-bearing ACOs said in a survey from the National Association of ACOs that they were very or somewhat likely to drop out of the Medicare program by May 31, which is the deadline the CMS offers to quit the program without being on the hook for losses. The survey had 81 participants, representing 42% of the program's risk-bearing ACOs.
The COVID-19 pandemic is causing concern among ACOs that they'll incur penalties this performance year because routine, preventive care has been put on hold while at the same time healthcare costs are rising through more hospitalizations.
"When ACOs made a commitment to assume risk, they didn't expect they'd be handling the risk of a global pandemic," said Clif Gaus, CEO of NAACOS, in a prepared statement.
The CMS in a recent interim final rule offered some relief to ACOs when it initiated its extreme and uncontrollable circumstance policy for ACOs as a result of the COVID-19 pandemic, but NAACOS argues it isn't enough.
"CMS has yet to adequately mitigate the costs and disruptions of the pandemic," Gaus said.
The CMS policy mitigates losses for ACOs by considering the total months in the performance year affected by the extreme circumstance and the percentage of assigned beneficiaries affected by the circumstance. Given the widespread nature of the pandemic, the CMS said all ACOs will be considered under the extreme and uncontrollable circumstance policy. The policy doesn't make any changes to the benchmark, which uses historical Medicare spending in addition to current performance year spending.
Rather than using just this policy, NAACOS has asked both the CMS and Congress to "hold clinicians harmless" from financial penalties should they occur due to COVID-19.
"Medicare's decade-long effort to change how we pay for healthcare to better reward quality and outcomes may be lost unless Washington acts quickly to throw these providers a lifeline," Gaus said in a statement.
Another concern for ACOs is the unpredictability surrounding cost and quality performance this year due to COVID-19. According to the survey, which involved 226 ACOs overall including some in the Next Generation ACO model, 65% of ACOs said it's going to be very difficult to accurately predict their performance this year.
ACO programs are designed under the premise that the cohort of beneficiaries is stable and therefore the ACO can reasonably predict how certain interventions can lead to better outcomes and lower costs. COVID-19 is making all those previous projections uncertain.
This uncertainty is "a likely driver for ACOs to quit the program" the survey said.
There are overall 517 ACOs in the Medicare Shared Saving Program that are assigned 11.2 million beneficiaries.