On December 1, 2014, CMS released a rule proposing several significant changes to the Medicare Shared Savings Program (MSSP) and calling for input on options under consideration to encourage greater participation in two-sided risk sharing models. The proposed rule was published in the Federal Register, December 8, 2014, pp. 72759-72872 Comments on the rule are due by 5:00 pm on February 6, 2015.

CMS proposes these changes as program refinements based on its experiences and stakeholder suggestions. The proposed changes also formalize guidance CMS has issued previously regarding the program, and the proposed changes further seek to reduce administrative burdens in MSSP operations. The proposed rule changes address the following areas:

  • Data sharing requirements;
  • Requirements for ACO participant agreements, the ACO application process, and CMS review of applications;
  • Identification and reporting of ACO participants and ACO providers/suppliers and managing changes to these lists;
  • Eligibility requirements related to the ACO’s number of beneficiaries, required processes, the ACO’s legal structure and governing body, and the ACO’s leadership and management structure;
  • Modification to assignment methodology;
  • Repayment mechanisms for ACO’s in two-sided performance-based risk tracks;
  • Alternatives to encourage participants in risk-based models;
  • ACO public reporting and transparency;
  • ACO termination process; and
  • The reconsideration review process.

The rule proposes new or changed definitions; adds a process for ACO renewal of participation agreements; clarifies and revises the beneficiary assignment algorithm; expands on beneficiary reporting data CMS would provide to ACOs; and simplifies the claims data sharing opt-out process to provide more timely access to claims data.

CMS believes greater efficiencies and savings remain to be realized by encouraging ACOs to move from Track 1 (shared savings) to Track 2 (shared savings/shared losses) models of operation. CMS proposes mechanisms to ease an ACO’s transition from Track 1 to Track 2, to reduce an ACO’s risk under Track 2, and to establish an alternative Track 3 risk-based model. Much early criticism has focused on CMS’ proposal to allow Track 1 ACOs to remain in Track 1 for an additional 3-year period rather than transitioning to Track 2 as now required; however, those ACOs remaining in Track 1 for a second 3-year period would experience annual reductions in their percentage share of earned savings (i.e., from 50% shared savings to 40% in year 4, to 30% in year 5, to 20% in year 6). Initial stakeholder reaction notes that to-date, most Track 1 ACOs have not met minimum savings thresholds and have not shared in savings; reducing the potential of shared savings in years 4-6 likely means that many Track 1 ACOs simply will not sign up for a second round of MSSP participation. CMS and stakeholders continue to assess long-term, sustainable MSSP operational ACO models.

The MSSP now includes more than 330 ACOs functioning in 47 states, Puerto Rico and the District of Columbia, with 125,000 Medicare enrolled practitioners providing services and impacting roughly 4.5 million Medicare beneficiaries. On November 7, 2014, CMS issued its first financial reconciliation and quality performance results for 220 ACOs with start dates in 2012 and 2013; in that report, CMS identified more than $460 million in qualified shared savings payments to these 220 ACOs as well as 23 Pioneer ACOs. Of the 220 MSSP ACOs, 58 kept spending below their benchmarks and earned shared savings of more than $315 million while 60 ACOs reduced their costs in comparison to their benchmarks but did not meet minimum savings thresholds needed to qualify for shared savings.

Five ACOs serving Iowa beneficiaries were included in the November 7 report. Two of those ACOs generated shared savings.

Accountable Care Clinical Services, PC: Iowa (Heartland Rural Physician Alliance), California, Connecticut, Massachusetts, Pennsylvania; start date 1/1/13; Track 1; earned shared savings of $5,157,823.

Genesis Accountable Care Organization: Iowa, Illinois; start date 7/1/12; Track 1; no earned shared savings.

Mercy ACO, LLC: Iowa; start date 7/1/12; Track 1; earned shared savings of $4,426,331.

Mercy Cedar Rapids/University of Iowa Health Care Accountable Care Organization: Iowa; start date 7/1/12; Track 1; no earned shared savings.

Unity Point Health Partners: Iowa, Illinois, Missouri; start date 7/1/12; Track 1; no earned shared savings.

A separate report issued by CMS in October of 2014 on Pioneer ACOs showed that Iowa’s Trinity Pioneer ACO experienced earned shared savings of $1,218,812 in its second year of performance.