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Published: August 17, 2017

Laying the foundation: Asking the right questions up front and identifying the right clinical partners is critical for ACOs seeking to unlock Medicare shared savings

August 17, 2017 - Curant Health Director of Clinical Services, Vickie Andros, PharmD, and Senior Director of Commercial Strategy & Performance, Jake Caines, in Becker's Hospital Review:

According to the Centers for Medicare and Medicaid Services (CMS), of the 480 Medicare Shared Savings Program ACOs only 30 percent earned shared savings of any amount in 2015.1

Why so few? Answering that with, “It’s complicated,” is both accurate and a massive understatement.

But as ACOs experience the growing pains associated with the transition to value-based care, we are learning that early decisions on ACO model selection, a focus on specific quality measures and careful selection of clinical partners are part of the foundation on which ACOs can improve their chances of successfully unlocking meaningful shared savings.

1. How much risk are you willing to accept?

One of the first decisions you will have to make is which ACO model to select. Currently, there are four types of ACOs: Medicare Shared Savings Programs (including “next gen”), Commercial, Medicaid and Pioneer. Within those, there are four formally defined “Tracks.” Since 91% of MSSPs are “Track 1,” we have written this series for those who are interested in exploring the MSSP Track 1 model.

To get the model to work for you, you’ll need focus on expenditures and quality
MSSP ACOs in track 1 may receive shared savings if they meet or exceed a prescribed Minimum Savings Rate (MSR), fulfill the minimum quality performance standards, and otherwise maintain eligibility to participate in the Shared Savings Program.2 Under this model the ACO is not responsible for shared losses.

Initially, the government based expenditure benchmarks solely on an ACO's historical Medicare spending and reset the marks periodically. Beginning in reporting year 2017, the financial benchmark that most Medicare ACOs use to determine whether they will share in savings or losses also incorporates regional spending factors.3

Unlike past HMO models, ACOs must meet numerous quality measures, in addition to achieving a reduction in expenditures, in order to benefit financially from ACO participation. Track 1 ACOs can receive a shared savings payment of up to 50 percent of all savings under the benchmark expenditure cap. For the 2015 reporting year (the latest year for which aggregate ACO performance data is available) the four quality domains - patient/caregiver experience, care coordination/patient safety, preventive health, and at-risk populations for diabetes, vascular disease, hypertension, heart failure and coronary heart disease - had different numbers of individual measures (from 7-10) and total number of possible points (from 12-22). The domains themselves were equally weighted at 25% each of the Quality Performance Standard score.

During Year 1, quality points are earned based on complete and accurate reporting; in subsequent years quality points are earned based on performance against a sliding scale for individual metrics. Cumulative quality points are then used to calculate a single, final quality score.

The final shared savings calculation is complicated and has multiple steps. It takes into account assigned beneficiaries, person-years, the per-capita expenditures benchmark and the final quality score, among other variables, to generate a final net earned performance payment.

To read the full article, visit Becker's Hospital Review.

To learn more about partnership opportunities with Curant Health, contact Kristin Lindsey, Senior Marketing Director, at


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