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Q: CMS administrator Donald Berwick said during the announcement that the final rule makes a stronger ACO framework. But does making it easier to qualify as an ACO really strengthen that framework?
A: I’m not sure that qualifying is all that much easier. Look, we’ve got to do something. Many healthcare policy folks agree the current system is unsustainable. Fragmented, un-coordinated care is a large contributor to the state of affairs now. There are many others, as well. This thing has great promise; we want that promise to be realized.
Q: What did CMS not change that you would have liked them to?
A: We characterized early on 10 or 12 deal breakers. There are a bunch of them but I’ll give you 5 or 6 of the key ones.
1. The way patients are assigned or aligned. We believe it should be prospective and there should be data sharing with identified patient information available. You can’t manage a population if you don’t know who’s in it.
2. Risk adjustment. We think there should be a commonly used methodology designed to take into account the disease severity of the population being served. Healthier patients cost less than sicker patients cost. And this is an adjustment for purposes of recognizing costs, computing savings, costs, etc. And so CMS proposed a method by which risk- adjustment would be done. It would be a look-back three years and a number would be arrived at based on a complex methodology and that the same number would be applied each and every year of the performance period without change. That’s fundamentally flawed and unfair. Because people can choose the doctor they seek care from, they can wander. And as much as 25 percent of the people go elsewhere. So we called for dynamic risk-adjustment. Doing exactly what has been suggested but doing over each year to reflect the population more accurately. That makes a big difference in terms of dollars and sense.
3. The two-sided model. They have changed that, it’s great.
4 . Minimum savings rate. This is a mechanism designed to ensure that whatever savings are realized from operations are the result of clinical intervention and quality care, not random fluctuations of statistical results based on the population size. Let’s say you save $100 and the minimum savings rate is 2 percent. Two percent comes off the top in the NPRM and goes to CMS, the program keeps it. And your potential shared savings are then calculated on the remaining 98 dollars. There are a lot of other machinations but that’s the essence. If you demonstrate that it’s not through fluctuations then you get first-dollar savings, meaning your shared savings split is based on the full $100. That’s huge.
5. Data reporting.
6. Too many measures; they changed that, too.
7. Anti-trust, anti-kickback, civil money penalty issues. I haven’t read that yet, but that’s easily a deal-breaker.
There’s a whole bunch of others, but those are the key ones we’ll be reading for. Some of those I mentioned may be changed, too. I haven’t read the whole document yet, I’d be foolish to opine beyond what I’ve said.
Previous ACO coverage: