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CareMount CFO Says COVID-19 Threw a 'Wrench' in Next-Gen ACO Plans

Analysis  |  By Alexandra Wilson Pecci  
   June 30, 2020

Kevin Conroy, CFO and chief population health officer at CareMount Medical, is encouraged by CMS's decision to extend its Next Generation ACO model through December 2021.

Accountable Care Organizations are all about assuming risk, but COVID-19 has changed what that risk-taking actually means.

The pandemic has "thrown a wrench" into CMS's "planning about continuing toward value-based care," says Kevin Conroy, CFO and chief population health officer at CareMount Medical in New York.

That's why he's encouraged by CMS's decision to extend its Next Generation ACO (NGACO) model through December 2021.

"My sense is that CMS and CMMI [Center for Medicare and Medicaid Innovation] remain committed to increasing the level of value and looking to providers to take care of patients more directly and have more responsibility for the premium dollars," he tells HealthLeaders.

In response to the COVID-19 crisis, CMS is making adjustments to its NGACO model in three areas: Financial methodology changes, quality reporting changes, and model timeline changes.

They are:

Financial methodology changes

  • Reduce 2020 downside risk by reducing shared losses by proportion of months during the PHE.
  • Cap NGACOs' gross savings upside potential at 5% gross savings
  • Remove episodes of care for treatment of COVID-19
  • Use retrospective regional trend, rather than prospective, for 2020
  • Remove 2020 financial guarantee requirement

Quality Reporting Changes

  • 2019 Web Interface quality measure reporting deadline extended from March 31, 2020 to April 30, 2020
  • 2019 quality audit canceled
  • Continue to monitor impact on 2020 quality reporting

Model Timeline Changes

  • Extend model through December 2021

Before the pandemic—in January 2020—CareMount Medical said its NGACO generated $778,583 in shared savings for the performance year 2018 for CMS' Next Generation ACO Model initiative.  

COVID-19's wrench has had far-reaching consequences, though.

According to a survey released in April, ACOs in Medicare's Shared Savings Program said they'll likely leave the program amid fears of getting stuck with massive financial losses to cover the cost of the COVID-19 pandemic.

The online survey by the National Association of Accountable Care Organizations asked 2020 Medicare Shared Savings Program and Next Generation ACO Model participants across the nation to gauge their experience in handling the ongoing pandemic, HealthLeaders reported.

Almost 80% said they were "very concerned" about their financial performance this year.

"When ACOs made a commitment to assume risk, they didn't expect they'd be handling the risk of a global pandemic," National Association of Accountable Care Organizations President and CEO Clif Gaus, said of the survey.

In addition to making COVID-19-related adjustments to its NGACO model, the Center for Medicare and Medicaid Innovation has also made COVID-19-related adjustments to its Direct Contracting Model options.

The National Association of Accountable Care Organizations said in a statement that it was "pleased" with the extension, as well as the CMS's decision to offer a second round of applications to participate in the Direct Contracting Model starting in 2022.

Despite the pandemic and the changes, Conroy says he believes CareMount is prepared for a future of value-based care because of the extensive groundwork it's been laying for many years, in addition to its NGACO success.

"Regardless of whether we go into a next-generation ACO, or whether we go into a Direct Contract Entity, we feel because of all the work we've done heretofore, we're prepared for any type of value-based, capitation-like program with respect to our Medicare population," he says.

Alexandra Wilson Pecci is an editor for HealthLeaders.

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