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Fewer ACOs Join Medicare Shared Savings Program, But More Take Downside Risk

Analysis  |  By Steven Porter  
   July 18, 2019

The drop comes in the first enrollment start-date since CMS overhauled the program to hasten ACOs' downside risk.

Sixty-six accountable care organizations (ACO) joined the Medicare Shared Savings Program (MSSP) this month, their first opportunity to do so since the Centers for Medicare & Medicaid Services overhauled the value-based payment program to require downside risk sooner.

The number of new ACOs, which includes 41 first-time participants and 25 that returned after a period of nonparticipation, is significantly lower than new enrollment numbers in previous years. The program had 124 new participants in 2018 and 99 new participants in 2017, according to the National Association of ACOs (NAACOS), which has raised concerns the MSSP overhaul could spur an exodus.

Counting new and returning participants, a total of 518 ACOs are currently in the program. That's 43 fewer than the 561 participants MSSP had last year.

"We hope this smaller class is only a reflection of an off-cycle start date and not an indication that the program and transition to value are slowing down," said NAACOS President and CEO Clif Gaus, ScD, in a statement.

This year's July 1 start date was a special one-time event. In future years, new participants will be able to join in January.

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CMS Administrator Seema Verma said in a Health Affairs blog post Wednesday that current participation rates are in line with the agency's projections, which means the program is on track to generate the expected $2.9 billion in savings over the coming decade.

"I am especially encouraged to see that an increasing fraction of ACOs are taking on real accountability," Verma wrote.

Nearly half (48%) of the ACOs with start dates on July 1, 2019—that includes the 66 newbies, plus another 140 ACOs that renewed their agreements—are taking on downside risk, Verma said. If they miss their cost targets, they will be required to repay CMS a small percentage of their revenue or cost target. Nearly one-third (29%) of all current MSSP ACOs are taking on risk, an increase of 10 percentage points, she said.

"This is projected to lead to more savings for beneficiaries and taxpayers, and provide stronger incentives for ACOs to coordinate care and improve quality for patients," Verma wrote.

When CMS launched its overhaul, which the agency dubbed "Pathways to Success," some industry groups raised concerns the changes could hamper participation, as Verma acknowledged in her blog post.

"However," she wrote, "today's results show that American providers are ready for the value-based transformation and are willing to accept greater accountability in exchange for more flexibility."

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Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.


The CMS administrator says participation is in line with expectations, queuing up an estimated $2.9 billion in savings over the next decade.

The National Association of ACOs hopes this isn't 'an indication that the program and transition to value are slowing down.'

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