Accountable Care Organizations

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On April 24-26, The National Association of Accountable Care Organizations held its semi-annual conference for members. NAACOS invites its business partner members, including Husch Blackwell, to attend their semi-annual meetings. Scott Loftin, a Healthcare Regulatory Associate in Husch Blackwell’s Denver office, and I were fortunate enough to attend the conference on behalf of the firm. This conference provided an opportunity for us to listen to the issues, challenges, concerns, and ideas ACO leadership are exploring and facing in today’s regulatory landscape. The presentations and conversations among the members provided us with a deeper understanding of our ACO clients’ business and legal needs.

This is the third article in our series on the new “Pathways” rules for Accountable Care Organizations.  Our first two articles in the series can be found here.

The Centers for Medicare and Medicaid Services (CMS) issued its anticipated final rule revising the Medicare Shared Savings Program to improve cost savings and quality.

With the changes in the final rule, the revamped program, called “Pathways to Success,” is projected to save Medicare $2.9 billion over 10 years—that’s $0.7 billion more than projected in the proposed rule issued August 9, 2018.

This is the second article in our series on the new “Pathways” rules for Accountable Care Organizations. Our first article in the series can be found here.

The Centers for Medicare and Medicaid Services (CMS) released a report on August 27, 2018, showing Next Generation accountable care organizations (ACOs) produced net savings of $62 million in 2016 while maintaining quality of care.  CMS Administrator Seema Verma pointed to the savings as evidence that ACOs taking two-sided risk succeed, according to a CMS press release. 

Even without potential changes to the Medicare program, MACRA poses a significant challenge for any clinician trying to determine the best strategy to maximize Medicare reimbursement – there are hundreds of pages of guidance in the proposed and final regulations to review and understand. But, at this point, clinicians attempting to assess MACRA must also deal with uncertainty about changes to the Medicare program. A significant source of uncertainty is the Trump administration’s stated intent to repeal the Affordable Care Act (“ACA” and also known as Obamacare), which is being implemented by current legislative efforts. Uncertainty about the ACA should be considered in developing a strategy to comply with MACRA.

As of January 2016, there were 433 Medicare Shared Savings Program (MMSP) Accountable Care Organizations (ACOs) with almost 7.7 million assigned beneficiaries and more than 14,000 participants (a participant may be a group or an individual). Most of these ACOs are one-sided model ACOs that may generate shared savings and do not involve shared losses (Track 1 ACOs).

Importantly, Track 1 ACOs are not considered advanced alternative payment models (APMs) for purposes of MACRA. As a result, a clinician participating in a Track 1 ACO is subject to the merit-based incentive payment system (MIPS) just like a clinician that is not in an ACO (a participant in an advanced APM is not subject to MIPS).

Under MACRA, the merit-based incentive payment system (MIPS) automatically applies to eligible clinicians (generally a physician or mid-level – see our previous blog post for details) and most clinicians who treat Medicare patients are expected to be included in MIPS. As a result, one of the most common questions about MACRA is when it starts. CMS’s final MACRA rule confirms that implementation begins Jan. 1, 2017.

The Office of the Inspector General (OIG) for the U.S. Department of Health & Human Services recently published its Fiscal Year 2016 Work Plan, which summarizes OIG’s priorities over the coming year. Notably, the 2016 Work Plan demonstrates the OIG’s expanded focus on delivery system reform and the effectiveness of alternate payment models, coordinated care programs, and value-based purchasing.

There were also noteworthy areas of new focus for several provider types, including skilled nursing facilities, hospice organizations, ambulatory surgical centers, and physician practices.  Below we have highlighted a few key areas from the FY 2016 Work Plan that will likely impact these providers. Please note this is not intended to be a comprehensive summary of the 2016 Work Plan and is focused only on the new OIG focal areas for these certain providers.