MedPAC offers recommendations to CMS on ACO programs Last Updated: July 30, 2014
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In a letter sent this week to the Centers for Medicare & Medicaid Services (CMS), the Medicare Payment Advisory Commission (MedPAC) said that regulatory and legislative changes are needed to resolve the current problems with Medicare ACO programs and to facilitate their long-term success.

The commission’s recommendations are based on input from Medicare ACOs and CMS, as well as analysis of the current programs. Many of the suggestions are consistent with concerns shared with MedPAC by Premier through public comment and other materials such as our pre-regulatory comment letter.

For the short-term, MedPAC recommends improving the methods used for attribution of Medicare beneficiaries to ACOs so that ACOs know who their beneficiaries are and what financial benchmark they are managing to as they deliver care. Specifically, MedPAC suggests using prospective attribution and benchmarks, expanding the types of primary care providers used in the attribution process to certain non-physician practitioners and identifying providers by both their tax identification number (TIN) and national provider number (NPI). MedPAC also recommends moving away from process measures toward population-based outcome measures.

For long-term improvements to Medicare ACO programs, MedPAC recommends that Medicare move to two-sided risk models, so that ACOs face risks as well as the potential for shared savings as a way to strengthen program incentives. However, MedPAC also stressed the need to make benchmarks more equitable and give providers tools to strengthen beneficiary engagement. As ACOs assume more risk, MedPAC recommends providing more regulatory relief to allow for innovative models of care, such as waiving the three-day stay requirement prior to a skilled nursing facility admission.

Finally, MedPAC suggests that CMS clarify what forms of communications with patients are permitted, improve the process for communication approval and allow ACOs that assume two-sided risk to reward their beneficiaries by waiving some or all cost sharing when seeking care by ACO providers.