Between 2018 and 2019, 74 of Medicare’s 561 accountable care organizations (ACOs)—or 13%—left the program, according to research by Leavitt Partners. The same research also found that 26% of ACOs that reached the end of their three-year agreement opted to not renew it at the end of 2018.
These departures contrast sharply with numbers from 2016-2017, when only 59 ACOs dropped out of the MSSP, and 2017-2018, when participation increased by 18%.
In an interview with HFMA, an anonymous CMS official commented that “[w]e have observed that the number of terminations occurring during performance year 2018 is slightly higher than what we have observed in prior years. However, we note that 90% of eligible ACOs elected the six-month extension from January 1, 2019 to June 30, 2019.” The official explained that in calculating this number, ACOs that did not renew their agreement with the Medicare Shared Savings Program (MSSP) were excluded from the total number of eligible ACOs.
Consequences of “Pathways to Success”
ACO experts agree that the main reason for these departures is the changes CMS made to the program in late 2018 with “Pathways to Success,” a modified set of participation options for ACOs in the MSSP. The participation options no longer include an “upside-only” risk model; instead, ACOs are required to select one of two tracks, both of which ultimately include some downside risk.
The rule limits contract agreements for upside-only ACOs to two years, as opposed to the six currently allowed. Additionally, CMS will reduce the savings potential during these two years from 50% to 25%.
When the rule was proposed, the National Association of ACOs (NAACOS) survey of Track 1 ACOs entering their third agreement period found that 71% were likely to leave the MSSP if required to assume downside risk. CMS itself estimates that over 100 ACOs will leave the program in the next ten years.
As a result, the NAACOS came out against the proposal, arguing that the initial successes of the MSSP would be walked back as ACOs abandon their current payment models and return to models that emphasize volume.
How will recently dissolved ACOs handle QPP reporting?
For 2019, most of the participants in recently disbanded ACOs will return to MIPS reporting. Clinicians previously covered by MSSP Track 2 or 3 ACOs may now need to report MIPS, whereas clinicians previously covered by MSSP Track 1 ACOs formerly were MIPS APMs, but will still have to significantly change their MIPS reporting workflows.
No matter how you plan to report, Healthmonix has you covered. To find out more about what this means for your organization, you can schedule a meeting with our team of experts here.