As physicians evaluate their options under the Medicare Quality Payment Program (QPP), many are considering participation in an alternative payment model (APM) for the first time, including the Medicare Shared Savings Program. The MSSP incentivizes physicians and other providers participating in an accountable care organization (ACO) to lower the total cost of care for the ACO’s attributed Medicare beneficiaries as compared to an adjusted historical benchmark. The MSSP regulations detail the manner in which beneficiaries are attributed, benchmarks are assigned and total costs of care are calculated.
Over the last five years, participation in the MSSP has grown rapidly. As of January 1, 2017, there are now 480 accountable care organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP). These ACOs serve more than nine million Medicare beneficiaries.
Advantages to participation
The decision whether to apply for, and participate in, the MSSP requires one to decide whether the potential business opportunity outweighs the known administrative overhead costs. Here, we summarize the case for MSSP participation.
1. QPP opportunities
Under the QPP, a physician who successfully participates in an advanced APM will not be subject to the Merit-Based Incentive Payment System (MIPS) and instead will receive a five percent bonus on all Medicare Part B payments. For 2018, three of the four MSSP tracks — all of which involve some downside risk — qualify as advanced APMs.
Presently, less than 10 percent of MSSP ACOs participate in either Track 2 or Track 3, under which an ACO may be required to make a repayment if it is not successful in reducing the total cost of care. To encourage more ACOs to accept risk, CMS is introducing Track 1+ in 2018, which involves a reduced repayment requirement.
Although a Track 1 MSSP ACO does not qualify as an advanced APM because it does not involve risk, participation in such an ACO still has significant benefits under MIPS. CMS applies APM scoring standards to calculate the MIPS score for physicians participating in an MSSP ACO, basing the individual score on the ACO’s performance on the MSSP quality measures. The only information on which the participating physician or his or her practice must report is the Advancing Care Information (formerly known as Meaningful Use) category. This significantly reduces the administrative burden imposed under MIPS and most likely will lead to higher MIPS scores.
2. The potential to earn shared savings
We now have three years’ worth of financial performance results for MSSP ACOs (2013-2015). An increasing proportion of ACOs have generated savings above their minimum savings rate (MSR) each year. For 2015, 31 percent of ACOs (120 of 392) generated savings above their minimum savings rate compared to 28 percent (92 of 333) in 2014 and 26 percent (58 of 220) in 2013.
ACOs with more experience in the program were more likely to generate savings above their MSR. For performance year 2015, 42 percent of ACOs that started in 2012 generated savings above their MSR, compared to 37 percent of 2013 starters, 22 percent of 2014 starters and 21 percent of 2015 starters.
If shared savings payments were the only opportunity presented by the MSSP, it would be hard to make the case for participation at this point in time. The real value of the MSSP is the role it plays in positioning providers for healthcare transformation, even beyond the QPP.
3. On-ramp for value-based reimbursement
To be eligible for shared savings, an ACO must hold spending below their assigned target and achieve a certain level of performance on specified quality measures. An ACO is also required to develop, implement and monitor participants’ performance on clinical practice guidelines.
By creating an environment for these quality assurance and improvement activities, an ACO supports its participants in developing competencies critical for success under other value-based reimbursement models with governmental or commercial payers.
4. Learning lab for population health management
It’s no secret that the key to achieving shared savings is to identify high-cost, high-risk patients and provide them with comprehensive care management services. An ACO’s care management infrastructure (including staff, processes and technology) is foundational to successful population health management.
5. Infrastructure for narrow or tiered networks
With employers and patients seeking more value for their healthcare dollar, more businesses are offering narrow network products for members to use for more efficient healthcare alternatives. These networks are not your “daddy’s HMO;” they value quality and efficiency, not just lower costs.
An MSSP ACO is well-positioned to secure commercial narrow network contracts, as the CMS “seal of approval” demonstrates the participating providers are committed to quality and more efficient care.
6. Access to data
An MSSP-participating ACO receives from CMS all claims data for the ACO’s attributed beneficiaries. Using this data, an ACO can better understand the cost of care across the continuum and identify opportunities for cost savings throughout the care lifecycle, as opposed to only having glimpses into silos of care settings. This expanded view of a population's consumption of healthcare resources also provides the opportunity to better manage the coordination of care, improving patient satisfaction, provider satisfaction and improving quality. The ability to analyze such data effectively will be synonymous with the ability to manage risk.
7. Fraud and abuse waivers
Participants in an MSSP ACO can utilize waivers to pursue financial arrangements that might otherwise be prohibited by the Stark Law, the Anti-Kickback Statute, the prohibition on gainsharing and certain limitations on beneficiary inducements, so long as the governing body approves the arrangement as promoting the MSSP’s purposes.
These self-executing fraud and abuse waivers (no submission to any government agency required) afford an enormous opportunity to ACO Participants to enter into new arrangements that incentivize quality and efficiency, even if they do not meet a Stark exception or an Anti-Kickback safe harbor.
8 The best defense is a good offense
With the rapid growth of the MSSP, now more than 50 percent of the population lives in an ACO’s service area. Existing ACOs are expanding their geographic reach to capture more lives and more hospitals and physicians are gearing up for the next round of MSSP applications.
A physician who joins an ACO becomes clinically integrated with other ACO participants, and thus is likely to shift referral patterns to his or her ACO brethren. The physician left on the outside looking in— having not pursued an ACO strategy—risks losing market share.
Opportunities for oncologists
Most MSSP ACOs that have lowered the total cost of care attribute their success to more aggressively managing the care of high-cost Medicare beneficiaries. With 10 percent of Medicare dollars spent on cancer care, there are significant opportunities to reduce costs through management of the entire continuum of care for cancer patients. Oncology practices willing and able to assume this role will be attractive to existing ACOs, as well as new ACOs forming for the 2018 application process.