MedPAC’s Recommendations to CMS Stir Controversy; Premier and NAACOS Take Opposite Stances
The recommendations this week of the Medicare Payment Advisory Commission (MedPAC), the independent congressional agency established to advise the U.S. Congress on issues affecting the Medicare program, to the Centers for Medicare & Medicaid Services (CMS), around the COVID-19 pandemic, have created a range of responses, even as MedPAC’s leaders have asked CMS to significantly modify its incentives around the COVID-19 situation.
A letter written to CMS Administrator Seema Verma on Monday, April 13, was sent under the signature of Francis J. Crosson, M.D., MedPAC’s Chairman. Dr. Crosson began the letter by writing that “The Medicare Payment Advisory Commission (MedPAC) recognizes the unique and difficult circumstances in which CMS currently operates, and we are cognizant of CMS’s competing priorities during this time. MedPAC appreciates the steps CMS has taken to date to mitigate the financial impact of COVID-19 on accountable care organizations (ACOs). ACOs should focus on their response to COVID-19 without concern for shared ACO savings or losses. The COVID-19 public health emergency has likely affected—and will continue to affect, at least through 2020— Medicare spending in ways that are yet to be fully understood. This is particularly problematic for providers participating in ACOs, whose 2020 performance will be assessed using benchmarks established before the current emergency,” Dr. Crosson said.
Further, Dr. Crosson wrote, “Given the dramatic shifts in care delivery that have occurred in 2020, attempting to adjust 2020 spending and benchmarks for COVID-19 will be impractical. It also may be inequitable. The degree to which different systems will have to divert resources to COVID-19 will vary widely depending on the provider’s location and type of services provided. Therefore, we urge CMS not to use data from 2020 when evaluating ACOs.”
Given those factors, MedPAC recommended that CMS consider the following recommendations, as written by Dr. Crosson. “Specifically, we ask that, to the extent your statutory authority permits, you consider four actions:
> Do not use 2020 data to determine ACO performance for purposes of computing ACO quality, bonuses, or penalties. Consider extending all current ACO agreement periods by one year. In addition, do not use 2020 data in calculating baseline year spending for future benchmarks.
> Do not use 2020 claims to assign beneficiaries to ACOs, since the shift to telehealth (possibly with physicians located very far away from beneficiaries) could distort ACO assignment. A determination could be made later about whether to use 2019 and/or 2021 claims to assign beneficiaries to ACOs in 2021.
> Allow a three-year extension of the NextGen ACO model through 2023. This will allow ACOs that have invested in the model to continue in the ACO program without having to adapt to a new model during this difficult time.
> Delay the start of the Center for Medicare and Medicaid Innovation Direct Contracting model by a minimum of one year to allow providers time to understand the new model(some features of which have not yet been established) prior to making commitments.”
The letter and its recommendations elicited a variety of reactions. Leaders at the Charlotte-based Premier Inc. were delighted by the MedPAC letter, with Blair Childs, Premier’s senior vice president of public affairs, saying in a statement published on April 13 to Premier’s website that "MedPAC’s recommendations are consistent with Premier’s positions, including the extension of the Next Generation ACO model, delaying the start of the Direct Contracting model and not using 2020 data in determining ACO performance. Providing stability in ACO models and financial relief for healthcare providers is especially critical during this otherwise volatile time.”
On the other hand, leaders at the Washington, D.C.-based National Association of Accountable Care Organizations (NAACOS) took an opposite tack, with NAACOS on April 14 publishing a statement to its website condemning MedPAC’s recommendations. Clif Gaus, Sc.D., NAACOS’s president and CEO, stated that MedPAC's recommendation to ignore shared savings in 2020 would devastate Medicare ACO programs. In 2018, Medicare paid ACOs back roughly $900 million of the $1.7 billion they saved. ACOs used that money to pay for quality improvement programs, care coordinators, health IT, analytics and other infrastructure. Without those funds, ACOs will no longer have resources to focus on improving quality and addressing chronic disease, which help improve patient care. The impact of the pandemic will play out differently from region to region and market to market. To gut the savings opportunity before the data are in is presumptuous at best.”
Indeed, Gaus said, “There are several other policy options MedPAC should be considering, including holding at-risk ACOs harmless, allowing ACOs the option to forego less in shared savings in order to take less risk, allowing ACOs to change their risk track, or extending the dropout deadline to give more time to understand how COVID-19 will playout in coming months. Ten leading provider organizations’ suggestion of holding downside risk ACOs harmless would importantly provide a safety net for ACOs hit hardest by the ongoing pandemic. MedPAC wants to pretend the year never happened.”
Earlier this week, NAACOS released survey data from its members showing that 56 percent, of healthcare organizations taking financial risk in a Medicare program said they are likely to drop out of that program because of fear of having to pay massive losses resulting from the COVID-19 pandemic.
In fact, Gaus continued, “MedPAC has consistently underplayed the value ACOs bring to Medicare payment reform. ACOs have saved Medicare billions of dollars and have done more to lower spending in a decade than all other reform efforts to date. Let’s hope CMS doesn’t accept this advice that would have detrimental effects on Medicare’s overall shift to value.”
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