Federal officials are making a high-stakes gamble with Medicare's popular shared savings program designed to encourage health systems, hospitals, and physician groups to assume more financial risk in treating patients, healthcare providers say.
Providers are bracing for a bumpy ride in the drive to quicken adoption of value-based payment at Medicare.
The least risky accountable care option available on the Centers for Medicare & Medicaid Services value-based payment palette was released last week with the Final Rule for the Medicare Shared Savings Program.
When the rule goes into effect, on August 3, MSSP participants will be allowed to bank a share of cost-effectiveness gains. The vast majority of participating providers have signed up for MSSP Track 1, where they avoid downside risk if performance benchmarks are not met.
Janis Orlowski, MD, chief healthcare officer at the Washington, DC-based American Association of Medical Colleges, notes that CMS has dropped some proposed changes to MSSP that had alarmed providers, but she says the agency missed opportunities to ensure the program's success as a driver of value-based payment change.
"The MSSP has garnered a lot of interest and initial participation, including many academic medical centers among the 400-plus current ACOs. The key question is less about breadth of adoption, but about longevity of participation. CMS has taken some steps to help ensure continued participation, including the option for Track 1 [participants] to stay in the program with their current savings rates. But we hoped to see more tools to support ACOs—[tools that might have made] significant investments in care managers, data systems, and quality improvement endeavors," she says.
As of January, the MSSP roster stood at 405 ACOs employing more than 15,700 physicians. Medicare's highest-risk accountable care model to date, Pioneer ACO, which features upside and downside risk, has 19 participating organizations this year.
Orlowski and other providers applaud CMS for launching a second round of three-year contracts for MSSP Track 1 and rejecting a proposed cut to the shared savings rate for MSSP Track 1 from 50% to 40%.
"Track 1 has been an essential testing ground for ACOs as they build infrastructure, develop new community partnerships, and change their patterns of care. AAMC strongly urged CMS to maintain Track 1 as a continuing option for those ACOs already in the program, and to maintain the current shared savings opportunities. We commend CMS on finalizing a policy to allow Track 1 ACOs to sign an additional three-year agreement, and appreciate that the agency did not further diminish the savings rates as were first proposed," Orlowski says.
Melissa Jackson, senior associate director of policy at the Chicago-based American Hospital Association, says maintaining and improving MSSP Track 1 is essential to help give healthcare providers more time to make the transition from Medicare's longstanding, volume-based, fee-for-service payment model to value-based payment models.
"About 99% of MSSP participants are in Track 1. We're skeptical there are a lot of people ready to advance past Track 1. One would hope that as CMS learns from the other ACO programs, they will work improvements into the Medicare Shared Savings Program. We're still on a learning track. We know from talking with our members that they are all over the place [in readiness for assuming more risk and adopting value-based payment models]," Jackson says.
CMS officials were queried for this report, but they could not provide comments before the publication deadline.
CMS Introduces Track 3
In addition to maintaining Track 1 as an MSSP enrollment option, other highlights of the 2016 Final Rule include:
- The creation of Track 3, a two-sided risk option that features a higher shared savings rate and prospective assignment of patients to ACOs
- Streamlined data sharing between CMS and ACOs
- For MSSP participants who posted shared savings gains and are seeking to renew their contracts, CMS plans to adjust the financial benchmark to preserve the sweetness of the pot.
In a prepared statement issued with Thursday's release of the 2016 Final Rule, CMS officials said more adjustments to the MSSP financial benchmark calculation will be made later this year:
"[The Final Rule] refines the policies for resetting ACO benchmarks to help ensure that the program continues to provide strong incentives for ACOs to improve patient care and generate cost savings, and announces CMS' intent to propose further improvements to the benchmarking methodology later this year."
Healthcare providers are urging CMS to make several other improvements to MSSP Track 1, including waivers for Medicare's three-day inpatient-stay trigger for payment of skilled nursing facility (SNF) costs and limiting payment for telemedicine services to rural areas. Pioneer ACO and MSSP Track 3 have waivers for the SNF three-day rule.
"Pioneer ACO providers have benefited from having the SNF exemption and CMS has saved more money," Jackson said.
Orlowski says the MSSP Track 1 waivers would help program participants to redesign care in ways that are oriented toward generating value for patients.
"Providers that form ACOs have new financial incentives to provide the right care, at the right time, and in the right setting," Orlowski said. "The waivers of a three-day inpatient stay requirement for SNF eligibility and the rural geography requirement for telemedicine would allow ACOs to treat patients in lower-cost settings and prevent unnecessary hospitalizations. This is better for patients, and helps ACOs earn shared savings. We are encouraged to see CMS include the SNF waiver in the Final Rule, but are disappointed that it is limited to only Track 3 ACOs and that the proposed telemedicine waiver wasn't finalized. "
Against the 3-Day Rule
Barbara McAneny, MD, chairperson of the Chicago-based American Medical Association Board of Trustees, says the SNF three-day rule is an inefficient, one-size-fits-all restriction on ACO physicians.
"Physicians participating in ACOs should be able to place patients in whatever care setting is most appropriate for the services that they need. In addition, because determinations about shared savings, and shared losses for Track 2 ACOs are driven by growth in the total cost of care for the patients assigned to the ACO, all ACOs have an incentive to keep patients out of high-cost settings like hospitals and SNFs if they do not require inpatient care. The AMA does not think this waiver should have been limited only to MSSP Track 3 ACOs," McAneny says.
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Accounting for nearly a quarter of national healthcare spending, Medicare is widely acknowledged as a powerful engine for change in the healthcare industry. However, McAneny says CMS has to allow for diversity of circumstance, readiness, specialty variation, and local market nuances in the creation of value-based payment models.
"The real question is not how big will the MSSP get, but how far will delivery reform get?" the New Mexico oncologist says. "Physicians in many different practice arrangements and specialties have ideas about how to improve care for their patients while also reducing healthcare spending for conditions like heart disease, stroke, cancer, and osteoarthritis. Currently, neither the Medicare fee schedule nor the MSSP give physicians the flexibility or predictability that they need to really change the delivery of patient care."
"For example," McAneny says, "if a family physician consults with an endocrinologist about managing their patients with diabetes or consults with a neurologist about their patients who have Alzheimer's, there is still no coverage in either regular Medicare or an ACO for this joint treatment planning, and the physicians involved will lose revenue they could have earned from face-to-face services."
Clif Gaus, president and CEO of the Washington, DC-based National Association of ACOs, says CMS should adopt several more improvements for MSSP, particularly in Track 1, such as prospective patient assignment and the waivers for the SNF three-day rule and telemedicine coverage. "There still is a lot of interest in forming new ACOs and the private payers are committed, [but] we are many years away from large-scale, two-sided risk ACO implementation," he says.
Christopher Cheney is the CMO editor at HealthLeaders.