Part 1 - Laying the foundation: Asking the right questions up front and identifying the right clinical partners is critical for ACOs seeking to unlock Medicare shared savings

According to the Centers for Medicare and Medicaid Services (CMS), of the 480 Medicare Shared Savings Program ACOs only 30 percent earned shared savings of any amount in 2015.1

Why so few? Answering that with, “It’s complicated,” is both accurate and a massive understatement.

But as ACOs experience the growing pains associated with the transition to value-based care, we are learning that early decisions on ACO model selection, a focus on specific quality measures and careful selection of clinical partners are part of the foundation on which ACOs can improve their chances of successfully unlocking meaningful shared savings.

1. How much risk are you willing to accept?

One of the first decisions you will have to make is which ACO model to select. Currently, there are four types of ACOs: Medicare Shared Savings Programs (including “next gen”), Commercial, Medicaid and Pioneer. Within those, there are four formally defined “Tracks.” Since 91% of MSSPs are “Track 1,” we have written this series for those who are interested in exploring the MSSP Track 1 model.

To get the model to work for you, you’ll need focus on expenditures and quality
MSSP ACOs in track 1 may receive shared savings if they meet or exceed a prescribed Minimum Savings Rate (MSR), fulfill the minimum quality performance standards, and otherwise maintain eligibility to participate in the Shared Savings Program.2 Under this model the ACO is not responsible for shared losses.

Initially, the government based expenditure benchmarks solely on an ACO's historical Medicare spending and reset the marks periodically. Beginning in reporting year 2017, the financial benchmark that most Medicare ACOs use to determine whether they will share in savings or losses also incorporates regional spending factors.3

Unlike past HMO models, ACOs must meet numerous quality measures, in addition to achieving a reduction in expenditures, in order to benefit financially from ACO participation. Track 1 ACOs can receive a shared savings payment of up to 50 percent of all savings under the benchmark expenditure cap. For the 2015 reporting year (the latest year for which aggregate ACO performance data is available) the four quality domains - patient/caregiver experience, care coordination/patient safety, preventive health, and at-risk populations for diabetes, vascular disease, hypertension, heart failure and coronary heart disease - had different numbers of individual measures (from 7-10) and total number of possible points (from 12-22). The domains themselves were equally weighted at 25% each of the Quality Performance Standard score.

During Year 1, quality points are earned based on complete and accurate reporting; in subsequent years quality points are earned based on performance against a sliding scale for individual metrics. Cumulative quality points are then used to calculate a single, final quality score.

The final shared savings calculation is complicated and has multiple steps. It takes into account assigned beneficiaries, person-years, the per-capita expenditures benchmark and the final quality score, among other variables, to generate a final net earned performance payment.

2. What is important when developing a winning strategy?

Population Segmentation
While beneficiaries may come and go throughout the year, it is critical that you have a solid understanding of your overall patient population. CMS reports on 4 enrollment groups: 1) patients with end-stage renal disease (ESRD); 2) patients who are disabled; 3) aged and dual-eligible patients with both Medicare and Medicaid coverage and 4) aged but non-dual-eligible Medicare-only patients. Which of these groups makes up the largest percentage of your ACO population? It is likely that that group or groups makes up the bulk of your ACO’s overall expenses and should serve as a guide as to where significant efforts to reduce fee-for-service expenses should occur.

Quality Improvements
Beginning in the 2015 reporting year, CMS began rewarding ACOs for quality improvement by adding additional points to their domain scores. MSSP ACOs are able earn up to four additional points in each domain if they demonstrate “significant quality improvements.” This is significant because four points represents a potential increase in the total domain score of 18 to 33%.4 Are you able to identify groups of quality metrics where your patients and your ACO would benefit from partnering with another clinical organization?

3. What part does medication management play in your strategy?

Performance metrics and quality standards impacted by medication management
There are 16 quality performance standards for ACOs impacted by medication adherence, education, and, by proxy, the medication management team. These measures represent components of three of the four key domains (patient/caregiver experience measures are not represented) and span all four Medicare enrollment groups.

In addition to its potential to positively impact a number of quality metrics and, by extension shared savings, medication management is important because it is a key area of opportunity at the heart of increasing population healthcare costs. Medication non-adherence is responsible for an estimated $300 billion in wasted U.S. healthcare spending every year. Through a partnership and study between Johns Hopkins and Curant Health, we know pharmacist-led medication management and patient support services are capable of improving adherence by over 30% compared to the standard of care for chronically ill patients. Are you staffed to provide outstanding medication management, or is this an area for partnership?

Performance metrics impacted by medication management include the following:
1. Domain Care Coordination and Patient Safety
a. ACO-36: All-cause unplanned admissions for patients with diabetes
b. ACO-37: All-cause unplanned admissions for patients with heart failure
c. ACO-38: All-cause unplanned admissions for patients with multiple chronic conditions
d. ACO-12: Medication reconciliation post discharge

2. Domain: Preventive Health
a. ACO-14: Preventive care and screening: influenza immunization
b. ACO-15: Pneumonia vaccination status for older adults
c. ACO-17: Preventive care and screening: tobacco use: screening and cessation intervention
d. ACO-42: Statin therapy for the prevention and treatment of cardiovascular disease

3. Domain: clinical care for at-risk population
a. ACO-40: Depression: depression remission at 12 months
b. ACO-27: Diabetes: hemoglobin A1c poor control and ACO-41: diabetes: eye control
c. ACO-28: Hypertension: controlling high blood pressure
d. ACO-30: Ischemic vascular disease: use of aspirin or another antithrombotic

4. What does success look like and what’s needed to achieve it?

At the 30,000 foot level, success for MSSP ACOs means unlocking meaningful shared financial savings through the “Triple Aim,” or better care for the individual, better health for the population and lower growth of expenditures. However, you might not get all three at once. This is a complex program with short term and long term implications for ACOs and their clinics nationwide.

Our best insight on how to set yourself up for success is two-fold. You must begin by conducting the necessary initial analysis of your patient population and the identification of areas where you will likely be able to make measurable, meaningful impacts on quality. Secondarily, the ACO must be willing to engage mission-driven clinics, practices and partners committed to a culture of care focused on achieving the “Triple Aim.”

In part two of this four part series, we will take a closer look at getting the right people on board and keeping them there.

About the authors:

Vickie Andros, PharmD, is Director of Clinical Services for Curant Health

Jake Caines is National Director for Curant Health


The views, opinions and positions expressed within these guest posts are those of the author alone and do not represent those of Becker's Hospital Review/Becker's Healthcare. The accuracy, completeness and validity of any statements made within this article are not guaranteed. We accept no liability for any errors, omissions or representations. The copyright of this content belongs to the author and any liability with regards to infringement of intellectual property rights remains with them.

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