The Centers for Medicare & Medicaid Services’ (CMS) strategic plan includes a set of strategic pillars that are foundational to the agency’s ongoing work. Two of those pillars are driving innovation and advancing health equity.

Additionally, the CMS Innovation Center unveiled its own strategy refresh document related to value-based models and priorities for the coming decade, including having every Medicare fee-for-service beneficiary in an accountable care relationship by 2030. CMS anticipates this goal could lead to an additional 30 million beneficiaries attributed to organizations such as an advanced primary care practice, Accountable Care Organizations (ACOs) or other entity that is responsible for the cost and quality of care.

Take the Medicare Shared Savings Program (MSSP), Medicare’s longest running and largest ACO. We can see how CMS is advancing these complimentary goals via policy changes in the proposed 2023 Physician Fee Schedule.

Medicare Shared Savings Program

Starting as a demonstration, the MSSP was made permanent under the Affordable Care Act. It continues today with some 11 million Medicare beneficiaries covered. CMS is now proposing changes that would encourage more ACO participation in rural areas and other underserved areas while directly changing certain model policies to reflect health equity implications.

Several of those policy changes, described below, include offering up-front payments for some new ACOs, longer glide paths towards two-sided risk, altering the ACO benchmark methodology and reflecting higher acuity, more complex patient populations in various policies.

Advance Investment Payments (AIPs)

AIPs would be provided to low revenue ACOs that are new to the shared savings program, that provide care to underserved populations, have applied under the BASIC track, and are unfamiliar with Medicare’s risk-based models. Additional eligibility requirements are that these ACOs may not include a hospital (other than a Critical Access Hospitals or small, rural PPS hospital) and cannot be owned by a health plan.  The AIPs is a one-time fixed payment of $250,000 along with quarterly payments for the first two years of an ACO’s agreement period.

The quarterly payments are equal to a risk-factor based score from 0-100 for up to 10,000 beneficiaries. Each beneficiary score will be derived from the ADI (Area Deprivation Index) national percentile rank of the beneficiary’s census block group (based on their most recent address). Based on this score, an associated dollar amount is applied. For example, a beneficiary with a score between 0-24 is associated with $0, but a beneficiary between 85-100 is associated with $45. Dual eligibility status would automatically equal a score of 100 and the maximum associated dollar amount of $45. ACOs receiving AIPs must use those dollars in specific ways, such as increased staffing, health care infrastructure and providing accountable care to beneficiaries.

Establish Health Equity Adjustment

This would support ACOs serving high proportions of underserved populations while incentivizing all ACOs to treat such populations. Up to 10 bonus points would be available for MIPS quality performance category score when reporting all-payer eCQMs/MIPS CQMs. This would be based on a multiplication of an ACO’s underserved multiplier and a performance measure scaler. For the underserved multiplier, CMS proposes to take the higher of the ACO’s proportion of assigned beneficiaries residing in a census block group with an ADI national percentile rank of at least 85 or the ACO’s proportion assigned beneficiaries that are dually eligible for Medicare and Medicaid. CMS establishes a 20% floor. For the scaler, CMS would group an ACO’s measure performance compared to other ACOs into high, middle or low performance which would then be assign points of 4, 2 or 0, respectively, and summed.

The 10 points could also potentially assist ACOs in meeting the proposed revised quality thresholds in order to receive shared savings. The proposed policy would allow for some shared savings on a sliding scale as opposed to the current all or nothing approach.

Alter Benchmarking Methodologies

To address various issues with benchmarking, CMS proposes incorporating a prospectively projected administrative growth factor CMS refers to as the Accountable Care Prospective Trend (ACPT) into a three-way blend along with national and regional growth rates which would then be used to update an ACO’s historical benchmark for each performance year in the agreement period. Doing so addresses situations where an ACO essentially competes with its own performance and/or has a larger market penetration (ex: a rural ACO may cover a regional area). CMS also proposes a “guardrail” to protect ACOs from this change. Additionally, the growth factor would be set at the beginning of an agreement period and remain unchanged, providing some level of certainty for the ACO.  

Longer Times Periods in Lower Risk

To encourage more ACO participation long-term, beginning with the 2024 agreement period CMS proposes allowing certain ACOs to remain in the BASIC track Level A (upside risk only) for a full agreement period of five years. Some of these ACOs may also be able to have two additional years in upside risk before transitioning into two-sided risk levels. ACOs currently in BASIC Level A or B would be allowed to remain at that level (one-sided risk) through the rest of their agreement period. CMS also proposes to allow ACOs to remain in BASIC track Level E or the ENHANCED track indefinitely.

These are only a few of the MSSP changes in the proposed 2023 Physician Fee Schedule. There are also other non-ACO payment and policy changes to consider as well. Please review CLA’s 2023 Physician Fee Schedule Regulatory Advisor for more details, and watch for the final rule to be released later this fall.

Looking to the Future, How We Can Help

Value-based or accountable care relationships are not going away. If every Medicare beneficiary were to be in some type of accountable relationship by 2030, there are broad implications for all providers and settings. Whether those arrangements will be through Medicare Advantage, Special Needs Plans, PACE programs, or value models like the MSSP, the question is where you will fit into that equation long-term. We can help.