Home Health & Hospice

CMS unveils new ACO model with boosted financial incentives, flexibility

Homecare E-News, March 16, 2015

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Last Tuesday, CMS announced a forthcoming model to expand its accountable care organization (ACO) program. The Next Generation ACO Model will be piloted among experienced care coordinators willing to take on the highest financial liability in exchange for the poten­tial to take in the biggest cuts of Medicare savings generated through improved patient outcomes.

In CMS’ ACO program—progeny of the Affordable Care Act—providers across settings band together to fulfill specific quality goals and partake in any Medicare cost savings they generate—or, in some cases, take a financial hit for the benchmarks they miss.
The Next Generation Model will allow participating partnerships to assume higher levels of financial risk and reward than are available under the existing tracks of the program. According to CMS, the goal of the model is to test whether strong financial incentives for ACOs, coupled with tools to support better patient engagement and care management, can improve health outcomes and lower expenditures for Medicare fee-for-service (FFS) beneficiaries.
The prospective model’s distinctive features include more predictable financial targets and the provision of increased opportunities for providers to coordinate care by easing certain rules that restrict homecare, telehealth, and postacute care in traditional FFS Medicare. For example, certain Next Generation ACOs could waive the requirement that beneficiaries need to be located in a rural area to receive coverage for telehealth. In addition, partnerships operating under this model could receive waivers that would allow claims for home visits from certain authorized clinicians after a patient is discharged from an inpatient facility.
The new model will join the two existing tracks of the ACO program.
Track 1 comprises the Shared Savings Program, which offers participants the chance to share in generated savings without risking losses for poor performance. Not surprisingly, this track is far and away the most popular. In January, the model gained 89 new participants, bringing the grand total to 405.
On Track 2 is the Pioneer Model, which offers participants a greater opportunity to partake in generated savings for their willingness to assume financial risk. CMS kicked off the pilot program a year earlier than its Shared Savings counterpart for 32 participants chosen based on their extensive experience in care coordination. Despite this selective process, 13 of the original participants have since dropped out, citing a host of program pitfalls, including financial losses or lack of gains disproportionate to performance. But in addition to these setbacks, the program also saw significant successes: In 2014, the remain­ing participants bolstered quality in 28 of 33 quality measures and experienced average improvements of 14.8% across all measures.
CMS expects to pilot the Next Generation ACO Model among 15 to 20 ACOs recruited through two initial performance periods, beginning next January for early adopters and in January 2017 for subsequent participants. In line with this tiered contract schedule, the agency is accepting applications in two rounds. Those wishing to participate in the first performance period must submit applications by June 1, 2015, while those aiming for the later start date will be expected to submit their applications by June 1, 2016.
Each Next Generation partnership will be expected to sign an initial agreement term that consists of three one-year performance periods with the option of two additional one-year extensions.
CMS will hold its first open door forum about the new model tomorrow at 4:00 pm ET.
For more information on participating in the call, click here.
To read CMS’ full announcement about the new ACO model, click here.
To access the agency’s request for applications, click here.

This is an excerpt from a member only article. To read the article in its entirety, please login.