Writing in an opinion piece in the Health Affairs Blog on September 11, three leaders from NAACOS, the Arlington, Virginia-based National Association of ACOs, strongly disputed key assertions made this year by Seema Verma, Administrator of the federal Centers for Medicare and Medicaid Services. The NAACOs leaders asserted, in their article, “ACO Participation Numbers Worth Watching as CMS Changes Take Root,” that Administrator Verma has framed the current statistics around the participation of accountable care organizations in the Medicare Shared Savings Program (MSSP) in a way that overstates MSSP-participating ACOs’ performance and understates the challenges involved in moving forward. The article was written by David Pittman, Allison Brennan, Clifton Gaus, ScD. The three are, respectively, NAACOS’ health policy and communications adviser, its senior vice president of government affairs, and its president and CEO.
As Pittman, Brennan and Gaus write in their blog, “In mid-July, the Centers for Medicare and Medicaid Services (CMS) released the latest number of accountable care organizations (ACOs) participating in the Medicare Shared Savings Program. This was the first opportunity for ACOs to apply to participate in CMS’s largest value-based payment program since the agency redesigned the program last year. Changes CMS calls “Pathways to Success” took effect on July 1.
Further, the three NAACOS leaders write, “In a Health Affairs blog post, CMS administrator Seema Verma wrote more ACOs “are taking on real accountability” for Medicare patients. Many ACOs opted to stick with the Shared Savings Program after years of investing in care coordinators, information technology, and changing the culture of their respective health systems to care more about disease prevention and cost reduction. There is also a growing knowledge base that ACOs can turn to for successful practices. A recent Health and Human Services Inspector General report outlined several strategies high-performing ACOs used to lower spending by an average of $673 per patient. All efforts to improve our delivery system and change incentives in health payments are not only appreciated, but sorely needed.”
They go on to write, “However, Verma and CMS failed to point out several concerning findings in the latest participation numbers. In 2019, the Shared Savings Program experienced a dip in ACO participation for the first time since it started in 2012, according to CMS data (exhibit 1). Fewer than half the number of new ACOs joined this year compared to the average of all previous years. While more ACOs than ever are taking on risk for their performance, ACOs dropped out of the program at record numbers as well, according to our analysis of publicly available data. While not yet a reason to sound an alarm, these data will be problematic for the Medicare program, patients, taxpayers, and providers if they continue. Policy makers should pay close attention as we move forward.”
A key issue that Pittman, Brennan and Gaus point out has been the disconnect between the facts on the ground, and CMS’s decision-making of late. On the one hand, they note, “ACOs lowered Medicare spending outside the ACO program by $1.8–$4.2 billion in 2016 alone by lowering Medicare Advantage payments and making other changes…. “Yet, instead of bolstering this effect, CMS moved to cut the length of time ACOs have in shared savings-only models from six years to as short as two. At the same time, the agency lowered the rates at which ACOs can share with CMS the savings they generate, dropping the maximum sharing rate from 50 percent to 40 percent for shared savings-only models. While there were a number of welcome program modifications such as a more gradual ramp up of risk, choice of how beneficiaries are assigned to an ACO, expanded use of beneficiary incentives and payment rule waivers, and longer agreement periods, many in the provider community worried participation would fall as a result of the net effect of the policies. Indeed, this may already be occurring,” they write.
The NAACOS leaders believe that the statistics released in August will likely prove to be “a blip on Medicare’s radar, and that participation will steady out next year.” As they note, “
Data show it takes three years before ACOs start to generate savings, and the concern has been raised that forcing risk before that may cause ACOs to drop out of the program. This is a missed opportunity for savings since the government retains a larger portion of savings from shared savings-only ACOs than from risk-bearing ACOs.” They conclude by urging CMS to encourage participation in “voluntary, total-cost-of-care payment models such as ACOs to get a wider chunk of our health system headed in a direction where payments reward quality and outcomes,” through setting adequate shared-savings rates, giving more time for providers to stay in shared savings-only models, eliminating the distinction between hospital- and physician-lead ACOs, and offering upfront payments for ACOs to get off the ground, while addressing how benchmarks are set among both high- and low-cost providers, and setting fairer risk-adjustment policies.
