CMS to phase in regional benchmarks for ACOs in shared savings program

A finalized rule for the Medicare Shared Savings Program released by CMS aims to offer stronger incentives for accountable care organizations (ACOs) by allowing an additional year in Track 1 participation and using regional spending data to adjust cost targets.

CMS will implement several changes to cost benchmarks adjustments for an organization’s second agreement period, in an effort to address complaints that ACOs were being measured against their own past performance rather than to other providers in their region. The adjustment based on “savings generated under the ACO’s prior agreement period” will be removed entirely.

The new methodology will be phased in for ACOs entering MSSP contracts beginning in 2017.

Another change made by the rule may push ACOs to the program’s more advanced tracks.

While most organizations participating in MSSP remaining in Track 1, where bonuses can be earned for hitting benchmarks but penalties are minimized, the new rule will allow ACOs to stay in that track for an additional year after its renewal request is approved before moving onto Tracks 2 or 3, where there’s financial risk involved.

“Today’s changes will encourage more physicians to improve patient care by joining ACOs, while also refining how the program measures success, so that current participants are better rewarded for quality,” CMS Acting Administrator Andy Slavitt said in a statement. “These new flexibilities are based on significant input from participants and will help physicians prepare for the new Quality Payment Program, part of bipartisan legislation Congress passed last year repealing the failed Sustainable Growth Rate.”

The final rule isn’t without its critics. Premier spokesperson Blair Childs said CMS missed an opportunity to ease ACOs’ transition into the new Advanced Alternative Payment Models payment system being introduced as part of the Medicare Access and CHIP Reauthorization Act (MACRA).

“"This final rule ignores the reality of MACRA and does not address the ability of ACOs to move into tracks that will qualify as Advanced APMs once the rules are finalized but before their three-year contract is up," Childs said in a statement to POLITICO. "This will lock out many early adopter ACOs from the bonus on eligible clinician payments."