- CMS' Next Generation ACO Model saved Medicare roughly $62 million while maintaining quality of care for patients, according to an analysis of 2016 data, the first reporting year for NGACO participants.
- Among the key findings were a 1.3% monthly decline in acute care hospital days, 1.5% monthly drop in nonhospital evaluation and management visits and 11.9% increase in annual wellness visits.
- Contributing to the savings was reduced spending in skilled nursing facilities (SNF), CMS notes. Four of the 18 active NGACOs in 2016 accounted for more than half the reduction in spending and utilization.
CMS Administrator Seema Verma said in a statement the results show how two-sided risk can be successful. "ACOs in the Next Generation Model are being held accountable with strong financial incentives and are provided with substantial flexibility and regulatory relief. They are delivering value and providing quality care to patients and taxpayers even in their first performance year, and we believe that these results are achievable for other ACOs under similar incentives," she said.
The Next Generation ACO model carries the most risk of any current ACO model, with organizations taking on 80% to 100% two-sided risk. In exchange, they can include added benefits that provide more flexibility in care delivery, such as telehealth services.
Most of the 2016 NGACOs assumed 80% risk and the fee-for-service payment mechanism. Overall, provider networks included 31,070 clinicians and 775 healthcare centers. The ACOs averaged about 26,500 beneficiaries. Eleven were integrated delivery systems.
Providers who signed on with the NGACO model in 2016 reduced Medicare Parts A and B spending by $18.20 per beneficiary per month, compared with beneficiaries not in the model, for a total of $100.08 million saved, according to the report. Integrated delivery system NGACOs may have benefited from previous value-based contracting experience.
Ten of the NGACOs fully implemented the SNF benefit enhancement, which waives the three-day hospital stay required for Medicare payment of SNF care. By contrast, few of the groups elected either telehealth or post-discharge home visit waivers, the other enhancements available under the model.
NGACOs also stressed the need for broader health IT and data analytics capabilities to support the model and cited challenges in integrating claims and electronic medical information. About half reported they were leveraging data from at least nine EHR systems, with limited interoperability and data sharing, the report says. NGACO leaders also reported building HIT support for benefit enhancements, including systems to flag aligned beneficiaries.
Studies have shown mixed results for ACOs. A 2017 analysis by Avalere found the Medicare Shared Savings Program missed federal cost-savings projections from 2010, when the ACA was enacted, by a wide margin. Instead of saving Medicare $1.5 million from 2013 to 2016, as the Congressional Budget Office predicted, the program raised federal spending by $384 million.
Under a proposed overhaul of the MSSP unveiled earlier this month, CMS would force ACOs to shift to risk-bearing models. Rather than the six years ACOs currently have, existing ACOs would have one year to move over to risk and new ACOs would have two years.
Under the Affordable Care Act, ACOs that entered MSSP Track 1 in 2012 or 2013 are supposed to convert to a risk-based model in their third contract period, which begins next year. Currently, slightly more than 80% of Medicare ACOs are in the upside-only MSSP track, which lets them share in savings but not losses. CMS expects 109 of the existing 649 participants could leave the program by 2028.
The new findings could bring more pressure for ACOs to assume risk, something most have been reluctant to do. In a recent National Association of ACOs survey, 71% of ACOs said they would likely leave the MSSP if forced to take on risk.