Accountable Care Organizations

ACO leaders support new bill designed to boost participation in value-based payment

July 26, 2021 10:07 pm
  • Accountable care organizations stand to benefit from a new bill that would increase investment funding and make changes to federal ACO programs.
  • ACOs are vital mechanisms that present a direct route to improving population health, several leaders said while speaking about the bill.
  • The COVID-19 pandemic has shown why models such as ACOs can be beneficial for providers and patients compared with a fee-for-service approach.

When an accountable care organization (ACO) works as designed, it becomes a virtuous cycle. Improvements in care delivery lead to shared savings that can be reinvested to further bolster population health.

Now advocates hope proposed legislation will put more ACO entities in position to realize the benefits.

For participating providers, “It’s really having predictable, stable revenue so that they can make investments to have better, healthier patients that can live their fullest lives,” said Vicki Loner, CEO of OneCare Vermont, a statewide, all-payer ACO. “So that’s the end game of value-based care. And that’s why the providers in Vermont are so invested in it.”

New bill designed to boost ACO participation

Loner spoke July 21 as part of a National Association of ACOs (NAACOS) webinar that examined the state of value-based payment (VBP).

She and other ACO leaders who spoke during the webinar voiced support for the Value in Health Care Act, which has bipartisan sponsorship in the House of Representatives and would update several VBP programs.

Changes to the Medicare Shared Savings Program (MSSP), the main federal ACO model, would include:

  • Increasing minimum shared savings rates for ACOs in the Basic track
  • Updating the risk adjustment cap
  • Eliminating the different criteria that apply to high- and low-revenue ACOs
  • Fixing the “rural glitch” that stems from the benchmarking methodology

The bill also would increase funding for educational and technical support for MSSP participants.

“The startup costs for ACOs can be prohibitive: Investments in clinical and care management, health IT, population analytics, reporting and administration often cost millions of dollars,” NAACOS states in a summary of the bill.

The organization hopes money in the bill can restart programs such as the ACO Investment Model, through which ACOs received startup funding that would be paid back from their shared-savings allocations.

Building on the benefits of ACO operations

OneCare Vermont is approaching the last stage of a four-part journey from fee-for-service to universal implementation of fixed payments to providers, Loner said. Such payments already are in place for all hospitals in Medicare and for independent primary care providers across payers.

Other participating providers receive all-inclusive payments, but those are reconciled back to fee-for-service and thus don’t allow for the same type of investment.

“What we would like to see is moving to that gold standard approach of having those fixed, predictable, stable payments, so that we can start to make those upfront investments in things like prevention, care coordination, quality and for the delivery system to make that investment in the care transformation that’s really necessary in order to fully embrace this movement in payment reform,” Loner said.

Megan Reyna, vice president for government and value-based programs with Advocate Aurora Health, said a value-based payment structure such as an ACO “helps us invest back into our system and into the quality of care and the team-based care that is so important.”

ACO payments likewise can be directed toward establishing an infrastructure that allows clinicians to address social determinants of health by efficiently making appropriate referrals, she said.

Shoring up care during a public-health emergency

The COVID-19 pandemic drove home the importance of ensuring the continued viability of ACOs, 14 healthcare groups wrote in a letter of support to the bill’s congressional sponsors.

“As part of their commitment to value-based care, ACOs and APM participants were already utilizing many of the tools which have been key to managing the COVID-19 crisis — such as care coordinators, remote monitoring, data analysis and aggregation, and patient tracking,” the groups wrote. “They were able to quickly and effectively deploy these same resources to manage patient populations throughout the pandemic.”

ACO leaders who spoke during the NAACOS webinar touted various benefits that were evident during the early stages of the pandemic.

“We were able to really utilize the claims and clinical data that we had to identify and prioritize those beneficiaries that were at highest risk for getting COVID and use some applications to identify [them],” said Melanie Matthews, president of MultiCare Connected Care, an ACO based in Washington state. “And then we were able to reach out to those beneficiaries and determine whether we needed to deliver or coordinate food or any critical appointments.”

As was seen with VBP arrangements in general, upfront payments helped providers in ACOs avoid the revenue volatility that hampered fee-for-service operations when patient volumes plummeted.

In particular, ACOs were a valuable source of support for independent primary care physicians who “didn’t have a strong balance sheet to rely on,” Matthews said. Those providers also received crucial technical support in setting up virtual platforms, she added.


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