Healthmonix Advisor

"Pathways to Success": ACOs Now And In The Future

Posted by Christopher Jayne on August 31, 2018
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The tracks of the Medicare ACO model vary greatly, but have been steadily gaining in prevalence since their launch in 2011. Despite the steady increase in ACO participation, most groups are staying at the Track 1 level. In fact, in 2018, 460 of the 649 ACOs existed at the Track 1 level.

There are a few reasons for this lopsided trend of “early stage” ACO dominance. First, Track 1 ACOs carry no downside risk. With no maximum financial loss and a potential 10% gain, there’s little incentive for an organization to look to move beyond this initial track. Even at the end of a three year agreement into an ACO, an organization can opt into a second three year term, meaning a Track 1 ACO can exist with no downside risk for 6 years.

Second, ACO success is not guaranteed. Many Track 1 ACOs are finding it difficult to meet the quality benchmarks, interoperability standards, and administrative requirements of being a high-performing ACO. In 2016, only 56% of ACOs saved relative to their benchmark. Even with no downside risk, many ACOs find that moving forward is not feasible when it’s that difficult to be successful.


What Makes A Successful ACO?

Considering the slow pace for some group to transition through, groups still in the MIPS track of the Quality Payment Program are wondering when any ACO is successful. The Patient-Centered Primary Care Collaborative dug into this question and produced some answers for us to consider. Specifically, they identified 6 key characteristics that successful ACOs share:

  1. Leadership and Culture. physicians need to buy into the model and participate as champions of the ACO, not just let it happen.
  2. Prior Experience. an argument for the three year track agreements, ACOs with more experience in the program were more successful and showed improvement.
  3. Health Information Technology. more interoperability, more sophisticated technology, and better use of the technology all factor into an effective HIT infrastructure.
  4. Care Management Strategies. ensuring that the staff works to coordinate care means your ACO will perform at a higher level.
  5. Organizational and Environmental Factors. there are quite a few factors at play here, but one of note is that more PCPs tended to mean higher performance, which isn’t surprising considering the preventative nature of many ACO quality measures.
  6. Incentive and Payer Alignment. simply ensuring that the financial compensation would be distributed to the best performers within an ACO improved performance.

These 6 characteristics are general and not necessarily easy to replicate, but they do paint a picture of an ACO that can improve and reach goals. They also indicate that a successful ACO is one that puts effort into evolving in places beyond the point of care.


Changes to the ACO Tracks

Because of new case studies of ACO success and the clear predominance of Track 1 ACOs, CMS has proposed changes to the model that could shake up the status quo. The “Pathways to Success” proposed rule looks to restructure the current ACO track system.

Notably, this proposal eliminates the 3 ACO tracks and compresses them into either a Basic or Enhanced ACO. Tracks 1 and 2 would be merged into the Basic ACO track, while Track 3 ACOs would become the Enhanced track. The Basic track would then have 5 transitional levels, where an ACO would spend one year per level.

RELATED: CMS Proposes New Changes to ACOs Under MSSP

This would afford new ACO’s two years of upside-only risk, rather than the six potential years current ACOs can take advantage of. CMS is keeping at the forefront of this rule their goal of implementing and progressing through the ACO model.

Not only does this rule accelerate the ACO tracks, but it also proposes an update to spending benchmarks to affect ACO scoring as well as a revamping of the Electronic Health Record requirements within the ACO program. Compared to the relatively minor changes in the MIPS program, it’s reasonable to expect many comments on the proposed rule reflecting on current ACO experiences and where the public feels this program needs to be in the future.


Topics: ACO, Industry insights, APMs