ACOs Fight Looming Cuts, Privatization Rhetoric

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WASHINGTON — CMS officials responded to concerns from accountable care organization (ACO) leaders about growth, a substantial pending payment cut, and ideological opposition, speaking at the meeting of the National Association of ACOs (NAACOS) here last week.

During a question-and-answer session with CMS Administrator Chiquita Brooks-LaSure, NAACOS CEO Clif Gaus, ScD, said the administration’s goal of moving all Medicare enrollees into accountable care relationships by 2030 could be a “steep climb,” given that only 43% of Medicare beneficiaries were participating in ACOs as of 2021.

In addition, the 5% bonus for participating in advanced alternative payment models (APM) — a clear incentive to join an ACO — is slated to expire in January.

“We feel like we’re sort of this … lost child that is achieving everything that was asked of us but not being recognized for it in these public policies,” Gaus said.

Based on conversations NAACOS members have had on Capitol Hill, extending the 5% bonus in Congress’s next continuing resolution doesn’t appear to be a top priority, he said.

In a separate roundtable with reporters at the conference, Emily Brower, MBA, senior vice president of Clinical Integration and Physician Services for Trinity Health, described the bonus as a “knowable, ‘plannable,’ countable dollar” that goes directly to participating providers. In a live poll of the audience, close to 78% of participants agreed that losing the advanced APM bonus would be harmful to their organization.

Brooks-LaSure stressed that extending the bonus “absolutely” has support from the Biden administration and is part of its budget proposal.

She also emphasized the need for members to continue to share stories about ACO’s value to patients.

Elizabeth Fowler, PhD, JD, deputy administrator and director of the CMS Innovation Center, also underscored the importance of messaging.

“There’s an undercurrent of opposition to moving towards value, and this narrative that’s cropped up claims that value-based care limits patient choice and will lead to privatization of Medicare,” she said at the conference on Friday.

In December, members of Physicians for a National Health Program protested outside of HHS, calling for an end to direct contracting. And in March, the House Progressive Caucus called for scrapping the ACO REACH model (formerly dubbed direct contracting), stating that it allows “third-party middlemen to manage care without seniors’ full understanding or prior consent, and often through for-profit businesses with incentives to restrict care,” according to Fierce Healthcare.

“We can’t ignore this narrative or hope that it loses steam,” Fowler said.

In addition to sharing success stories and better explaining how patients benefit from accountable care models, ACOs must also work to “shore up and ensure public trust and confidence,” she said.

“We have to double down on transparency,” Fowler added, for example, by sharing quality data and financial information for direct contracting models and, soon, the ACO Reach model. CMS is looking for opportunities to share more details about who model participants are, she added.

Another significant challenge for ACOs, despite their “constrained budgets,” is that they’re now we’re being asked to address “the social ills” of the country, Gaus said.

Robert Fields, MD, MHA, a former board chair for NAACOS, asked Brooks-LaSure how much of an ACO’s healthcare dollars should be redistributed for social spending.

The CMS administrator didn’t specify a number but acknowledged that it may feel like ACOs are being asked to solve “every problem” — even those outside of healthcare. However, by partnering with “healthcare adjacent” organizations, she said, there are opportunities to tackle health and social issues at once.

“When you see the patient and what they’re really focused on [is], ‘I can’t pay my rent. I can’t afford groceries,’ they’re not going to be in a position to do some of the things that you as the provider want them to do,” Brooks-LaSure said.

She noted that CMS’s 1115 waivers and the CMS Innovation Center provide opportunities to create such partnerships. As CMS evaluates these models, NAACOS will have a better sense of the kinds of ideas that the administration will support, Brooks-LaSure said.

Fowler noted that the models currently under development incorporate the “shared goals” put forward in the agency’s “strategic objectives,” which include health equity, affordability and “partner[ing] to achieve system transformation.”

Those objectives also highlight the need to set “more accurate benchmarks” and establish “financial methodologies that set participants and CMS up for success,” Fowler said. NAACOS has expressed support for many of the CMS-proposed changes to the Medicare Physician Fee Schedule, in particular to “mitigate the lowering of an ACO’s benchmark over time” and allow participants a longer glide path before “advancing to the highest levels of risk.”

She noted that the agency is working on a report expected out in October to provide a roadmap for next steps.

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    Shannon Firth has been reporting on health policy as MedPage Today’s Washington correspondent since 2014. She is also a member of the site’s Enterprise & Investigative Reporting team. Follow

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