BREAKING NEWS: CMS Unveils Details of Its New Next Generation ACO Program

On Monday, Jan. 11, the federal Centers for Medicare & Medicaid Services (CMS) announced the unveiling of the Next Generation ACO program, a new program for providers creating accountable care organizations under the aegis of that agency.

As CMS explains on its website, “Building up on experience from the Pioneer ACO Model and Medicare Shared Savings Program (Shared Savings Program), the Next Generation ACO Model offers a new opportunity in accountable care—one that sets predictable financial targets, enables providers and beneficiaries greater opportunities to coordinate care, and aims to attain the highest quality standards of care.”

The agency reported today that 21 ACOs are participating in the Next Generation ACO program. Those ACOs are in the following states: Maine, Massachusetts, Pennsylvania, North Carolina, Florida, Michigan, Indiana, Wisconsin, Illinois, Minnesota, Iowa, Texas, Arizona, and California.

Among the 21 is Steward Integrated Care Network, Inc., in Boston, which had announced in November of last year  that it was leaving the Pioneer ACO Program. But the Mount Auburn Cambridge Independent Practice Association (MACIPA), which had made the same announcement that it was planning to leave the Pioneer program and join the Next Generation program, was not identified as one of the 21 Next Generation ACOs today.

CMS’s press announcement noted that “The Next Generation ACO Model is a new CMS Innovation Center initiative that builds upon experience from the Pioneer ACO Model and the Shared Savings Program. With 21 participating ACOs, the new model offers a new opportunity in accountable care—one that enables providers and beneficiaries greater opportunities to coordinate care and aims to attain the highest quality standards of care. Unlike other models, this model includes a prospectively (rather than retrospectively) set benchmark, allows beneficiaries to choose to be aligned to the ACO, and tests beneficiary incentives for seeking care at Next Generation providers, including increased availability of telehealth and care coordination services.”

What’s more, CMS said in the announcement, “The Next Generation Model participants will have the opportunity to take on higher levels of financial risk – up to 100 percent risk – than ACOs in current initiatives. While they are at greater financial risk they also have a greater opportunity to share in more of the Model’s savings through better care coordination and care management. In addition, the ACOs will receive their budgets prospectively, in advance of the performance year, to plan and manage care around these financial targets from the outset. The ACOs will also be able to select from flexible payment options, such as infrastructure payments that support ACO investments in care. “

And the announcement quoted Patrick Conway, M.D., Deputy Administrator for Innovation  and Quality and Chief Medical Officer for CMS, as saying that “Accountable Care Organizations are improving quality of care and spending dollars more wisely. These new initiatives place patients at the center of a coordinated care delivery system and give providers the tools to achieve better outcomes.” The announcement added that “ These initiatives also advance the Administration’s goals, announced on January 26, 2015, to move 30 percent of traditional Medicare fee-for-service payments into alternative payment models that pay providers based on the quality rather than the quantity of care they provide patients by 2016 – and 50 percent by 2018. The Affordable Care Act provides tools, such as Medicare ACOs, to move our health care system toward one that rewards doctors based on the quality, not just the quantity, of care they give patients. Today’s announcement is part of the Administration’s broader strategy to improve the health care system by paying providers for what works, unlocking health care data, and finding new ways to coordinate and integrate care to improve quality.”

Meanwhile, all 21 participating organizations are listed on the fact sheet page for the Next Generation ACO model, which can be found here. Also on the fact sheet page is this list of principles for the program:

• Protect Original Medicare beneficiaries’ freedom to seek the services and providers of their choice;
• Engage beneficiaries in their care through benefit enhancements designed to improve the patient experience and reward seeking care from ACOs;
• Create a financial model with long-term sustainability;
• Utilize a prospectively-set benchmark that: (1) rewards quality; (2) rewards both improvement and attainment of efficiency; and (3) ultimately transitions away from an ACO’s recent expenditures when setting and updating the benchmark;
• Mitigate fluctuations in aligned beneficiary populations and respect beneficiary preferences by supplementing a prospective claims-based alignment process with a voluntary process; and
• Smooth ACO cash flow and support investment in care improvement capabilities through alternative payment mechanisms.

In addition, CMS noted in its announcement on Monday that, with the addition of the 21 participating ACOs in the Next Generation model, there are now 477 ACOs nationwide participating in one of the following CMS programs for ACOs: the MSSP, Pioneer ACO, and Next Generation ACO models, and the Comprehensive ESRD Care Model; and that those organizations are serving 8.9 million Medicare beneficiaries, and that 64 of the 477 are bearing some financial risk at this point.

Healthcare Informatics will update readers on new developments in this developing story.