AAFP, Other Groups Laud Promising Rural ACO Improvement Act

Senate Bill Would Fix Broken Performance Formula

October 28, 2019 05:05 pm News Staff

A recently introduced Senate bill that would revise the Medicare Shared Savings Program benchmarking process could level the playing field for rural accountable care organizations -- "a critical step to ensuring all providers and patients are able to benefit from this program," the AAFP told lawmakers last week.

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In an Oct. 22 letter(2 page PDF) to Sens. Catherine Cortez Masto, D-Nev., and Pat Roberts, R-Kan., the Academy and 14 other organizations voiced support for the act, which, they said, "fixes a formula to measure ACO performance by more fairly comparing ACOs to their markets."

The senators' Rural ACO Improvement Act, S. 2648,(www.congress.gov) would amend Title XVIII of the Social Security Act to improve the benchmarking process for the Medicare Shared Savings Program, which now factors an ACO's own beneficiaries into the regional calculation. That methodology, the letter said, "systematically disadvantages ACOs in rural areas and makes it harder for them to achieve savings even when they improve quality and reduce costs on par with their counterparts in urban areas."

"No ACO should be placed in a less favorable financial position due to their geography alone, and design flaws that discourage ACOs from operating in rural areas should be eliminated."

By remedying the faulty MSSP benchmarking process, said the letter's co-signatories -- which include the American College of Physicians, the National Rural Health Association and the AMA -- S. 2648 would do just that. And the change could benefit the entire U.S. health care system.

Citing CMS data,(data.cms.gov) the Academy and its co-signatories said that ACOs "collectively had saved Medicare $1.7 billion last year alone, and $739 million after accounting for shared savings bonuses and collecting shared loss payments."

In 2018, ACOs had an average quality score of almost 93 percent, the letter added. Further, studies published by Harvard University,(www.nejm.org) the Medicare Payment Advisory Commission(www.medpac.gov)
and Dobson DaVanzo & Associates(www.naacos.com) indicate that "ACOs are lowering Medicare spending by 1 percent to 2 percent, which translates into tens of billions of dollars of reduced Medicare spending when compounded annually."

Yet the full promise of the ACO model -- and the MSSP, which launched in 2012 -- "can only be realized if all ACOs have an opportunity to be rewarded for their efforts to improve quality and reduce costs," the letter said.

Related AAFP News Coverage
AAFP Leads Effort to Extend MSSP Application Deadline
Letter Notes Complexity of Rule Necessitates Extension to March 29

(1/24/2019)

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Accountable Care Organizations (ACOs)