CMS Announces New ACO Model Featuring Medicare—Medicaid Shared Savings

A new accountable care organization (ACO) model announced by CMS aims to improve care and lower costs by allowing beneficiaries enrolled in both Medicare and Medicaid to be covered under Medicare Shared Savings Program ACO. The Medicare—Medicaid ACO Model was one of several initiatives unveiled today by CMS as part of its ongoing efforts to develop innovate payment models.

Under the current Medicare ACO rules, Medicare—Medicaid beneficiaries may be covered in Medicare ACOs, but those ACOs within the Medicare Shared Savings Program are often not financially responsible for the Medicaid expenses of those dual enrollees. The new model amends that by holding these ACOs accountable for the quality and cost of Medicare and Medicaid services for these patients.

“This model aims to provide improved care coordination for those enrolled in both Medicare and Medicaid, allowing providers to focus more on providing care for their patients rather than administrative work,” Patrick Conway, MD, acting principal deputy administrator of CMS, said in a statement.

CMS is now accepting letters of intent from states interested in participating in the Medicare—Medicaid ACO Model, and will eventually enter into participation agreements with 6 states.

Industry leaders have praised the new model, hoping that strengthening care coordination among providers can potentially help contain costs and improve outcomes for the high-need patients enrolled in both Medicare and Medicaid.

“Dually eligible Medicare beneficiaries can cost nearly 50% more than non-dually eligible Medicare beneficiaries. This reflects their greater healthcare needs. They also can have an impressive array of services available to them. However, matching services to needs is always a struggle,” said Travis Broome, MPH, MBA, vice president of policy at Aledade. “With this new model, their physicians will have access to data and to financial support through the ACO to match the needs of these dually eligible beneficiaries with the services available to them and coordinate their care, leading to improved health and consequently reduced costs.”

The new ACO model was described by CMS as “one in a series of Innovation Center initiatives that will expand opportunities for clinicians to participate in Advanced Alternative Payment Models (APMs)” under the Medicare Access and CHIP Reauthorization Act.

Another statement today announced the addition of more opportunities for providers to participate in advanced APMs, including through a new voluntary bundled payment model.