Hospital association wants CMS to ease ACO rules

The American Hospital Association (AHA) is lobbying the Centers for Medicare & Medicaid Services to back off on some of the requirements of its Medicare Shared Savings Accountable Care Organization (ACO) program, saying the current rules place too much financial risk on providers without offering them enough financial rewards.

"CMS' overall risk versus reward equation continues to tilt too much toward risk and too little toward reward," asserts a letter sent to CMS by Linda E. Fishman, an AHA senior vice president of public policy analysis and development. Only 29 of the 114 providers in the MSSP were able to realize savings, the letter notes, with two of those ACO participants disqualified due to murky quality reporting. Meanwhile, the cost of starting an ACO and operating it in the first year is far higher than the $1.8 million estimated by CMS, according to Fishman.

"The number one way to increase participation in ACO programs is to modify the shared savings determination to ensure that more ACOs are able to receive a bonus--and a larger bonus--so that they can continue to invest in the program," Fishman wrote.

ACOs are under significant pressure. Nine providers announced last year they intended to exit the Pioneer ACO model. Seven said they would apply to the MSSP model instead, with two others saying they would exit the ACO experiment altogether. Those exiting the program said the cost-risk equation didn't work out for them.

In order to enhance provider benefits, the AHA recommended that CMS extend ACO engagement periods from the current three years to six years; cut the mandatory minimum cost savings from 3.9 percent to 2 percent in order to encourage participation from smaller and rural providers; and explore cutting the savings threshold further in order to boost bonus payments. It also suggested the agency created a voluntary signup program for Medicare beneficiaries to participate in an ACO.

To learn more:
- read the AHA News Now article
- check out the AHA's letter to CMS (.pdf)

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