ACO participation reaches new low as advocates press Biden for major changes

Medicare spending costs money
The National Association of ACOs is pressing the Biden administration for changes to combat a decline in participation in Medicare Shared Savings Program. (Getty/zimmytws)

The number of accountable care organizations participating in the Medicare Shared Savings Program this year shrank to 477, down from 561 in 2018, new data shows.

The National Association of ACOs blamed several Trump administration policies for the decline and pressed for the Biden administration to boost participation.

The new administration needs to “re-examine the balance of incentives and risk to ensure ACO growth and continued savings to Medicare, which ACOs have a history of producing,” said NAACOS President Clif Gaus in a statement Thursday.

The number of ACOs for 2021 is below the ACOs that started with the Trump administration in 2017 (480), according to new data from the Centers for Medicare & Medicaid Services, which oversees the program. ACO participation reached a record high of 561 in 2018 but has declined down to 518 in 2019 and 517 last year, federal data shows.

While participation in the program has shifted and declined over the years, ACOs still continue to generate savings for Medicare. The program generated $2.4 billion in gross savings for Medicare in 2019 compared with 1.7 billion in 2018, NAACOS said.

Part of the reason for the decline was policies instituted by the Trump administration. Chief among them is the creation of the “Pathways to Success” program that required ACOs to take on financial risk faster than the original program.

The Trump administration argued MSSP gave weak incentives to ACOs and it needed to accelerate the push to value-based care.

ACOs agree to meet certain spending and quality targets and get a share of any savings they generate but must repay Medicare if they miss those targets.

NAACOS said that CMS should install several fixes to give providers more incentives to sign up for the program, including fixing benchmarking and risk adjustment issues that affect the spending targets.

RELATED: CMS: ACOs saved Medicare $1.2B in savings under 'Pathways to Success' program

CMS should also give ACOs more time before they have to take on financial risk and give more timely and complete data to participants.

“A steady erosion of ACO participation damages our ability to get to where we need to be,” Gaus said, referring to the shift from Medicare fee-for-service to value-based care.

Another issue has been the pandemic, as NAACOS blasted CMS’ decision last year to remove the opportunity for ACOs to enter MSSP in 2021.

This year the 2021 ACOs will represent 10.7 million beneficiaries, with 41% of them in two-sided risk and 59% in the one-sided risk track.