Experts: Medicare ACO final rule will help but doesn't go far enough

Several features of the Centers for Medicare & Medicaid Services' final rule for accountable care organizations (ACOs) in its Medicare Shared Savings Program (MSSP) will encourage more providers to participate in the program, but the rule does not go far enough on risk assumption, healthcare experts wrote in a blog post for Health Affairs.

One of the most important changes in the new rule concerns financial benchmark calculation, according to Brookings Institution authors S. Lawrence Kocot, a visiting fellow, Mark McClellan, former CMS administrator, and project manager Ross White. 

The new rule provides equal weight to the ACO's performance for the three years before it joins MSSP, as opposed to the historical calculation, which made the last year 60 percent. This will force ACOs to shift their focus to their long-term spending before joining the program, according to the authors. However, the final rule did not alter the benchmarks' risk adjustment to control for population health, they said. As a result, the current policy will disincentivize ACOs from taking on patients with chronic conditions who would benefit from coordinated care.

Another problem with the new rule, according to the post, is its failure to provide a path to transition away from the fee-for-service model. The post proposes a fourth track for ACOs willing to assume more financial risk than the current model allows, similar to the new Next Generation ACO model.

Meanwhile, consolidation in healthcare has led to the departure of 27 ACOs from MSSP, according to an analysis from Leavitt Partners. While some ACOs have left the program, much like the several that exited the Pioneer program, others merged with larger ACOs.

"We're seeing a lot of smaller ACOs realize they weren't big enough to do what they wanted to do," analysis co-author David Muhlestein, Leavitt Partners' senior director of research and development, told FierceHealthcare in an exclusive interview.

To participate in the MSSP, an ACO must have at least 5,000 Medicare beneficiaries, and many found it easier to merge than maintain that number, according to Muhlestein. In the wake of the new CMS rule, he said, similar consolidation will likely continue, but "I don't think the rules are necessarily going to affect it that much."

To learn more:
- read the Health Affairs post
- here's the Leavitt Partners' analysis