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CMS Pushed to Extend ACO Track 1 Option

By John Commins  
   February 26, 2018

Advocates warn that ACOs unready to assume downside risk will drop out of the program if CMS does not extend Track 1 for a third agreement period.

Provider associations are calling for an extension of the Medicare Shared Savings Program Track 1 because some accountable care organizations are not ready for downside risk.

"Many ACOs remain in Track 1 because they are unprepared to assume risk requiring them to potentially pay millions of dollars to Medicare, which is simply not practical or feasible for most of these organizations," the providers said in a joint letter to Seema Verma, administrator for the Centers for Medicare & Medicaid Services.

"Providers in rural areas and safety-net providers, which care for some of the most vulnerable patient populations, often face even greater challenges than other providers when considering taking on risk. However, the challenge of being forced into risk is of great importance to ACOs of all sizes, composition and ownership," the letter said.

The organizations that cosigned the letter include: The National Association of ACOs, the American College of Physicians, the American Medical Association, the Association of American Medical Colleges, the Medical Group Management Association, and Premier healthcare alliance.

MSSP Track 1 represents 82% of MSSP ACOs in 2018. However, ACOs may only remain in Track 1 for two agreement periods before moving to a two-sided risk model or dropping out of the program. The providers asked Verma to extend Track 1 for a third agreement period.

Early adopter ACOs that began the MSSP in 2012 or 2013 entered the second agreement periods in 2016. Their third agreement periods begin in 2019, the first time ACOs will be forced into a two-sided risk arrangement. They will make their decision about 2019 participation based on limited performance data from 2012/2013 through 2016, the letter noted.

"These ACOs need more time to prepare for two-sided risk," the letter said. "While six years may sound sufficient, given the programmatic changes and considerable learning curve for these ACOs, this is not enough time."

The letter said that Track 1 should be extended for a third agreement period for ACOs that meet at least one of the four criteria that include:

  • Generating net savings relative to their benchmark across four performance years, including those years that do not surpass their minimum savings rate, which in some cases can be as high as 3.9%.
  • Scoring at or above the 50th percentile in quality performance in two of three pay-for-performance years.
  • Improving overall quality score by 10 percentage points over the course of the three pay-for-performance years.
  • Spending that's lower than that of Medicare fee-for-service providers in the same service area.

The providers warned that ACOs that are not ready to assume the downside risk will drop out of the program if CMS does not extend the agreement period.

"Using a government mandate for risk is not the solution to increasing participation and achieving successful results for two-sided ACOs," their letter said. "The unintended consequences of forcing risk will significantly undermine the MSSP and result in diverting valuable investments in care coordination away from Medicare patients and towards other patients under value-based contracts."

John Commins is a senior editor at HealthLeaders.

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