Despite the Obama administration's efforts to retain and attract participation in the Medicare Shared Savings Program for accountable care organizations, some may walk away because the agency failed to budge on some of their concerns.
The ACO initiative creates financial incentives for providers to reduce costs while meeting quality benchmarks.
In a rule updating the program, which was outlined in the Affordable Care Act and launched in 2012, the agency finalized a proposal to allow ACOs to stay in the program longer than three years without progressing to a track that includes downside risk—meaning they would have to return money to Medicare if they fail to reduce costs.
The CMS estimates that allowing more time in the lower-risk track would entice as many as 90% of the participants to stay in the program.
Stakeholders agreed that change was a crucial one. But they also said the CMS didn't go far enough in other areas.
For example, the rule allows waivers to ACOs in the riskier tracks—such as allowing home health services for beneficiaries who aren't homebound—that aren't available to ones that decline to risk penalties if they fail to meet cost and quality benchmarks.
“I am concerned there will be a substantial number of ACOs that will choose not to renew,” said Clif Gaus, CEO of the National Association of ACOs.
Officials said in the rule they wanted to study the impact of the waivers in the higher risk models before extending them across the program.
About 230 of the 400 participants just completed three-year commitments and are now deciding if they'll continue, according to Jeffrey Spight, who serves on the board of the ACO association and is president of Collaborative Health Systems, a division of health insurer Universal American that operates about two dozen ACOs with Medicare shared-savings contracts.
Some of them may be discouraged by the government's decision to punt on overhauling its methodology for benchmarking and rebasing, the framework for determining whether ACOs are successfully holding down costs. Many have complained that the existing policy punishes providers that are already very efficient.
“You may see people drop out over this,” said Chas Roades, chief research officer of the Advisory Board Co., a healthcare consulting firm.
Meanwhile, physicians and hospitals are rapidly entering similar contracts with private health plans.
“Some people may leave, but on the commercial side of the market they are also moving to value-based payment systems,” said Stephen Shortell, a health policy expert at the University of California at Berkeley. “So it's like, where are they going to run to?”