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March 06, 2020 05:00 PM

MedPAC: There's room for specialists in ACOs, but no savings

Michael Brady
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    While specialists have argued that they don't have enough opportunities to participate in value-based payment models, new federal research suggests that isn't the case.

    Specialists have significant chances to be part of alternative payment models and accountable care organizations, according to the Medicare Payment Advisory Commission, which held its monthly meeting Thursday and Friday. But ACOs determine the role of physicians, like whether they're involved in ACO leadership, and if they can receive shared savings.

    ACOs affiliated with health systems tend to have more specialists than ACOs led by primary care physicians, which may not even include specialists.

    In 2018, hospital-affiliated ACOs in the Medicare Shared Savings Program were made up of 65% specialists compared to just 50% of physician-led ACOs.

    Next Generation ACOs had an even wider gap: 63% of physicians in hospital-affiliated ACOs were specialists, while just 36% of physicians were specialists in doctor-led ACOs.

    That's likely because hospital affiliated ACOs usually include all their employed physicians.

    Previous research has shown that MSSP ACOs with more primary care providers reduce the number of visits with specialists and total Medicare spending. In contrast, ACOs with more specialists have higher utilization and spending on average.

    That could be driven by the fact that physician-led ACOs have stronger financial incentives to lower the use of specialty care since "they do not lose fee-for-service revenue when they provide less specialty care," suggested Ariel Winter, principal policy analyst for MedPAC, adding, "By contrast, multispecialty ACOs could lose substantial fee-for-service revenue if they make fewer referrals to specialists."

    Several MedPAC commissioners expressed interest in hospital-based payment reform and learning more about how health systems pay their employed physicians. Under the Medicare Access and CHIP Reauthorization Act of 2015—MACRA—clinicians can receive a 5% incentive payment if they participate in an Advanced APM. But if a hospital pays specialists a salary, the payment goes to the hospital.

    It creates an incentive for hospitals to include all their clinicians in the ACO, even though "half of what they're doing, in terms of revenue, is not attributable to their PCPs attributed population," said MedPAC Commissioner Dana Gelb Safran, head of measurement for Haven.

    "The hospital is only at risk for the patients of its primary care physicians," she said. "They're still riding the fee-for-service horse."

    Nobody knows if hospitals are using those payments to incentivize specialists to lower utilization. But it's crucial to find out since compensation isn't likely to affect how physicians deliver care if there's a significant gap between when they see a patient and when they get paid.

    "It's time that we explore ways for population health and episodic models to coexist," said MedPAC Commissioner Brian DeBusk, chief executive officer of DeRoyal Industries. "People need to understand how they're getting paid."

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