The Centers for Medicare and Medicaid Services will invest in rural and underserved accountable care organizations and introduce more flexibility to the Medicare Shared Savings Program with the aim of kickstarting stalled enrollment and bridging health equity gaps.
CMS will offer advanced shared savings to low-revenue ACOs and allow more flexibility for those that take on performance-based risk, the agency announced in a final rule published Tuesday. CMS also finalized adjustments to ACO benchmarks to incentivize long-term participation. Regulators anticipate the changes will lead to $650 million in higher shared savings payments to ACOs.
The updates are part of the physician fee schedule regulation, which also reduces pay for doctors and relaxes supervision requirements for behavioral health practitioners.
“Today’s finalized changes to Medicare’s largest ACO program bring a win to patients and will absolutely help providers deliver accountable care to more patients,” National Association of ACOs President and CEO Clif Gaus said in a news release.
The trade group represents providers that participate in Medicare’s population health payment and delivery models, including the Shared Savings Program, which enables physicians to form ACOs that coordinate care for individuals enrolled in fee-for-service Medicare. Participation in Medicare’s Shared Savings Program is voluntary, but providers that join can earn bonuses based on quality and cost metrics.
CMS revisited the program’s rules after finding inequitable representation of minority patient groups and higher-spending populations in the program, along with a plateau in the total number of beneficiaries assigned to ACOs through the model.
The agency aims to reverse these trends by offering funds to incentivize providers located in rural or underserved areas to form new ACOs. CMS will provide eligible ACOs with one-time payments of $250,000 and quarterly payments for the first two years of a five-year agreement. The quarterly payments will be determined by the neediness of beneficiaries.
Providers must spend all of the advanced payments to improve infrastructure, increase headcount or deliver care to underserved patients. ACOs will be required to publicly disclose the advanced payments received and spent.
CMS will recoup money when an ACO begins earning shared savings. Funds won’t be clawed back if an ACO doesn’t achieve savings, unless the ACO ends the agreement early.
CMS will begin accepting applications for advanced payments next year and dispensing them in 2024.
The agency also adjusted the ACO benchmarking system to promote long-term participation. CMS’ previous policy linked ACO's benchmark rates to how much they saved in previous years. ACOs that saved more each year faced increasingly high standards, making it hard to reach the savings necessary for the program to be profitable.
CMS has finalized adoption of a prospective, external factor into the ACO benchmark, along with a prior savings adjustment in& historical benchmarks. The agency also reduced the cap on negative regional adjustments of national per capita spending for Medicare Part A and Part B services for assignable beneficiaries to -1.5%, from -5%.
To facilities providers managing care, ACOs that lack experience with performance-based risk will be able to participate in five-year agreements under a one-sided shared savings model, with the potential to extend it two more years. Additionally, some low-revenue ACOs in the basic program that meet certain quality standards can share savings even if they don’t clear the minimum savings rate.
CMS also finalized policies to improve the risk-adjustment methodology for ACOs, incorporate health equity as a quality metric and reduce administrative burdens by rescinding a rule that organizations must submit marketing materials to review. And it loosened requirements for the skilled nursing facility three-day rule waiver.
The agency delayed a policy on split evaluation and management visit payments for one year. Clinicians who provide split visits will continue to choose from four elements to determine the substantive portion of those visits.
The National Association of ACOs cheered CMS’ moves to provide advance shared savings, add a health equity adjustment, factor in ACOs’ past performance to lower their benchmark over time and give ACOs more time before they are forced to take on financial risk. But the organization did not get everything on its wish list.
The trade group decried CMS’ lack of action on what it referred to as the “rural glitch,” under which ACOs no longer benefit from regional adjustments when reducing their spending on assigned patients. The association also criticized CMS for using a prospective projected external factor for ACO benchmarks for their financial spending target, contending that more than a third of ACOs will be harmed by this change.
