MSSP Changes Present Opportunities, but Likely to Decrease Number of ACOs, NAACOS Says

The proposed rule from CMS to revamp the Medicare Shared Savings Program (MSSP) in a bid to get accountable care organizations (ACOs) to take on risk faster presents many new opportunities for ACOs, but also challenges, according to a webinar from the National Association of ACOs (NAACOS) that delved into the key proposals.

CMS is currently collecting comments on the proposed rule, and NAACOS expects a final regulation in late 2018 or early 2019.

“This rule contains many sweeping program changes, probably more than anticipated, and these really represent the most significant changes that the program has seen since the first round of rules came out in 2011,” explained Allison Brennan, MPP, vice president of policy for NAACOS.

The proposed rule does away with the current tracks and replaces them with 2: Basic and Enhanced. Within the Basic track, there are 4 levels—levels A through E—that ACOs would move up through each year.

Read Aledade’s take on the new MSSP proposal.

“This proposed rule really does envision a new structure for the program with some familiar elements from the current tracks,” explained Jennifer Gasperini, senior policy advisory at NAACOS.

Levels A and B in the Basic track have a 25% sharing rate and are upside only. ACOs will start taking on risk in the third year, when the ACO moves into Level C. This new structure only allows ACOs to stay in 1-sided risk for 2 years, down from the current structure which allows 1-sided risk for up to 6 years. The new proposed structure would be:

• Level A: 25% sharing rate; upside only
• Level B: 25% sharing rate; upside only
• Level C: 30% sharing rate; first dollar losses at 30%, not to exceed 2% of revenue and capped at 1% of the benchmark
• Level D: 40% sharing rate; first dollar losses at 30%, not to exceed 4% of revenue and capped at 2% of the benchmark
• Level E: 50% sharing rate; first dollar losses at 30%, not to exceed 8% of revenue and capped at 4% of the benchmark

When ACOs move from the Basic track to the Enhanced track, there is a sharp jump in risk. While ACOs in Enhanced can share 75% of savings, they face their first dollar losses up to 15% of the benchmark. Both Level E and the Enhanced track are eligible as Advanced Alternative Payment Models (APMs) under the Quality Payment Program of the Medicare Access and CHIP Reauthorization Act (MACRA), while Levels A through D are only eligible as a Merit-based Incentive Payment System APM.

The opportunities in the new rule include a more gradual ramp-up of risk for the majority of the structure, increased stability and predictability through 5-year agreements, and the implementation of expanded waivers and beneficiary incentives.

However, the proposed changes could have an overall negative impact on the program.

“One of the biggest challenges we see and one of the most troubling things we see in the regulation is an overall predicted decrease in the number of ACOs,” said Brennan. She added that NAACOS believes CMS’ estimates are actually low, and that more ACOs than expected could leave the program and new ACOs might be discouraged from even joining.

Other challenges NAACOS highlighted in the webinar included a shortened shared savings only timeframe for all new and existing ACOs, reduced shared savings rates for shared savings only and low-risk ACOs, and a proposed risk adjustment cap of 3% across the entire 5 years of the agreement.

Brennan added that an additional challenge the new proposed rule presents is that all the changes would be taking place at once. Given the timeline of the changes, there will be no new cohort in January 2019—the next opportunity to join MSSP will be July 2019.

The proposed regulation also has new methodology for risk adjustment with a symmetrical cap of ±3% for the 5-year agreement period. This means the adjustment between the benchmark year in year 3 and any performance year during the 5-year agreement would never be more than 3% in either direction, Brennan explained. While NAACOS views the proposed risk adjustment change as a step in the right direction, it still has concerns about the 3% cap as it would be applied across the agreement.

“This might be something that would be beneficial in the first year of the program, but as we get to the later years in the agreement period, it becomes problematic when we’re still referring back to that benchmark year,” she said. “The difference in time is too great.”

While having 2 tracks—Enhanced and Basic Level E—available to qualify as Advanced APMs under MACRA is consistent with the current situation, Brennan did note that NAACOS is concerned about MACRA in general. CMS estimates for 2019 show that the potential number of providers earning Advanced APM bonuses is likely to level off between 2018 and 2019 rather than increase.

“I think overall, as we look at the implementation of MACRA, we do have concerns with CMS slowing down in the overall transition to value,” Brennan said.