Blog Post

Pathways to Success: Seven Questions ACOs Are Asking

Pathways To Success Web

When CMS abruptly announced its proposed rule to overhaul the Medicare Shared Savings Program (MSSP) last week, one thing was abundantly clear: ACOs will no longer be able to avoid taking on downside risk, signaling Medicare’s intent to make accountable care organizations more “accountable” for managing the total cost of caring for their beneficiaries.

Read the Five Key Takeaways from Proposed Changes to the Medicare Shared Savings Program.


Navigating the proposed program, Pathways to Success, can be daunting for new and existing ACOs. While it will take time before the final rule offers definitive guidance, here are seven important considerations that ACOs should begin to address now.

1. What is the updated timeline to apply?

Instead of the expected start date of January 1, 2019, the next start date for new or renewing ACOs will be July 1, 2019. After that, the regular annual application process for January 1 start dates will resume. Organizations that anticipate applying should begin preparations now so they will only need to make revisions when the final rule is published (pending a 60-day comment period ending on October 16, 2018). Existing ACOs with agreements expiring at the end of 2018 will have the option to extend their agreements for a fourth agreement year (the six-month period from July 1 through December 31, 2019) or to terminate as scheduled. CMS suggests the application period will begin early in 2019.

2. Should we apply to the BASIC or ENHANCED track?

  • Consider the ACO’s appetite for risk and its past performance. Organizations new to value-based payment methodologies will likely begin with the BASIC track.
  • Look at the organization’s potential for upside opportunity. Organizations confident in their care management and quality improvement capabilities may be best suited starting in the higher risk/reward levels of the BASIC track, or even the highest risk/reward ENHANCED track.
  • To help make this decision, ACOs should revisit their financial modeling assumptions to incorporate the proposed new benchmarking methodology. The modeling should consider assumptions for the impact that qualifying as an Advanced APM would have by allowing physicians to be paid using the enhanced fee schedules available under MACRA.

3. Should we choose prospective assignment, or preliminary prospective assignment with retrospective reconciliation?

Moving forward, ACOs will have the opportunity to select their assignment methodology every year. CMS has proposed that ACOs can select either assignment methodology prior to the start of each agreement period and change that selection for each subsequent performance year. Previously, the SNF three-day waiver was only available to tracks with prospective assignment, but in the future, it will be available regardless of an ACO’s beneficiary assignment methodology. Importantly, prospective assignment provides ACOs with a confirmed list of participants in advance of the performance year, which may help identify high-risk beneficiaries and overall population management. Prospective assignment with retrospective reconciliation, on the other hand, may be more accurate in that it will reflect only the confirmed beneficiaries of an ACO during a given performance year.

4. Does our ACO meet the new Certified Electronic Health Record Technology (CEHRT) requirement?

CMS proposes to reduce the reporting burden by retiring the EHR quality measure related to CEHRT (ACO-11) and instead requiring ACOs to attest that a minimum of 50% of their eligible clinicians use CEHRT. ACOs participating in a track that qualifies as an Advanced APM will be required to attest to the greater of the CEHRT threshold required for Advanced APMs or the 50% threshold described above.

5. Should we apply for the SNF three-day waiver?

The SNF three-day waiver application for 2019 is also being deferred to the July 1, 2019, start schedule. ACOs participating in a two-sided risk model will be eligible to take advantage of the SNF three-day waiver, regardless of their choice of prospective assignment or preliminary prospective with retrospective reconciliation. This means that all BASIC and ENHANCED track ACOs could eventually participate in the waiver, whereas under the current MSSP, only Track 1+ and Track 3 ACOs were eligible to apply. An ACO that is not already collaborating with SNF providers should conduct outreach to potential SNF partners to begin discussing an affiliate relationship.

6. Should we provide access to telehealth services?

Beginning January 1, 2020, the ability to be paid for telehealth services will be expanded. Eligible physicians and practitioners in two-sided risk models could be paid for providing telehealth services to prospectively assigned beneficiaries, regardless of their geographic location. Patients would be able to receive certain telehealth services at their homes to support care coordination across settings. ACOs should evaluate the economics of providing telehealth services to their beneficiaries.

7. Should we collaborate with Part D sponsors?

CMS is requesting comments to understand how ACOs and stand-alone Part D prescription drug plans (PDPs) can collaborate to improve the coordination of pharmacy care for Medicare beneficiaries, reduce the risk of adverse events, and improve medication adherence. ACOs should consider the potential of this type of collaboration. Survey the marketplace and make preliminary inquiries with existing PDPs to open a dialogue on what this partnership could look like and submit a joint comment to explain the value of such an arrangement to the beneficiaries and to CMS. It will be valuable to understand how clinical and pharmacy data could be gathered and shared to support improved coordination. An ACO may also wish to be proactive by responding to CMS’s question: “How should financial arrangements be structured to reward ACOs and Part D sponsors for achieving better health outcomes and lower growth in expenditures?”

These are just a few of the significant proposed changes to the MSSP. In anticipation of the final rule and with the additional time before the application period, ECG recommends that ACOs continue to plan for the July 2019 start date or decide how to incorporate these changes into their existing operations.