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CMS releases final ACO Pathways to Success rule: what’s next?

On December 21, 2018, CMS released the final rule for the Pathways to Success ACO program, which replaces the Medicare Shared Savings Program, or MSSP. While there are many differences between the two programs, the main differentiator is that Pathways significantly accelerates the pace of change, requiring participating ACOs to take on more risk more quickly. CMS is taking this more aggressive stance because evidence from previous Medicare programs suggests that value-based payment models are most successful at reducing healthcare costs when providers have skin in the game—that is when they take on downside risk. One specific example of this is the Next Generation ACO model, which required the highest level of downside risk of all the CMS programs and also resulted in the largest spending reduction.

The accelerated path to risk will present challenges for ACOs but should not be a barrier to participation for most of these organizations, which are already deeply invested in providing high-quality coordinated patient care. ACOs can thrive under Pathways by adopting a well thought out strategy that includes taking advantage of program incentives, investing in data-driven tools and technology, partnering with providers across the continuum, and banding together as a community to share best practices.

Assessing an Organization’s Appetite for Risk

ACOs in the MSSP have a wide range of experience with risk, as well as different levels of appetite for risk. A number of major health systems are actually managing their at-risk populations through multiple programs, and so they are already thinking bigger than just the ACO they belong to and building infrastructure to support other risk-based programs such as BPCI-Advanced, as well as laying the groundwork for expanding Medicare Advantage populations. For these organizations, risk is becoming the new norm and the possibility that experienced ACOs will “drop out” of the program is low.

At the other end of the spectrum are younger ACOs, for which the prospect of taking on downside risk is understandably quite daunting. They may only have experience with upside-risk models and need guidance to make the shift from simply cutting costs to running their healthcare organizations like a business, as is required with downside risk. Here are some tips for these ACOs to ease the transition.

Actionable Tips for Newer ACOs

All ACOs should take the time to review and fully understand the final Pathways rule and how it applies to their unique organization. ACOs that decide to move ahead with participation can benefit from these tips:

  • Take advantage of the program’s waivers and incentives (available to ACOs in downside risk models):
    • The 3-day SNF waiver allows ACO patients to be admitted to a SNF after a short hospital stay or even from the community, instead of requiring that the patient spend at least 3 days inpatient. The expansion of the waiver speaks to CMS’ recognition of how critical post-acute care is and how important it is to manage post-acute spend.
    • The telehealth waiver removes previous restrictions on virtual healthcare treatment by allowing a patient’s home to become an “originating site.” This has the potential to greatly increase access to specialists, as well as offering a convenient treatment option to homebound patients.
    • The Beneficiary Incentive Program allows ACOs to provide incentive payments to beneficiaries of up to $20 for each qualifying primary care service that the patient receives. Although currently the ACO must fund such a program, NAACOS is lobbying for a government fund in the future.
  • Invest in technology that facilitates real-time data sharing: Know where your patients are at all times, and know how they are faring in care settings across the continuum. Adopt tools that facilitate intervention in real time to improve outcomes. Real-time data helps improve key accountable care benchmarks such as length of stay and readmissions.
  • Collaborate with providers across the continuum: There’s a huge opportunity in the post-acute space, specifically, where spend and quality vary the most. By evaluating the care patients receive in PACs and building partnerships based on quality, ACOs can significantly reduce costs while improving care.

Last but not least, ACOs can rely on their own growing community for knowledge-sharing and support. At the 2018 NAACOS fall conference, we saw ACOs sharing best practices and working together to solve the new problems emerging under accountable care. NAACOS offers numerous resources to guide ACOs through the Pathways program (listen to this recent webinar to understand the key differences between the proposed and final rule) and will continue to develop more tools.

NOTE: CMS will begin accepting applications this Friday, January 18. Currently the deadline for applying is February 19, although industry groups are lobbying for an extension. Guidelines on applying are available from CMS.

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