NAACOS Leaders Urge Federal Policymakers to Endorse ACO Models Under New Administration, Congress
With the change of administrations that will be coming in January, the leaders of the Washington, D.C.-based National Association of ACOs (NAACOS), which represents hundreds of accountable care organizations nationwide, on Thursday, Nov. 12, published an outline of what they consider to be successful ACO models, and NAACOS’s president and CEO has published an analysis in the Health Affairs Blog.
In a press release published to the association’s website, NAACOS’s leaders said on Thursday that, “As the Biden-Harris administration starts its transition work and crafts its policy priorities, an evaluation published today of different alternative payment models (APMs) outlined the success of accountable care organization (ACO) models, which make providers financially responsible for all of patients’ spending over the course of a year. Compared to APMs that focus on discrete episodes of care or patients’ medical homes, ACO models have generated savings while maintaining quality of care. As such, Clif Gaus, NAACOS president and CEO, and David Pittman, NAACOS policy and communications advisor, argue in a Health Affairs Blog published today that the Biden-Harris administration should focus their attention on ACO models as they work to change the way Medicare pays hospitals, doctors and other providers.
In the Health Affairs Blog article published on Thursday, Clif Gaus, Sc.D., and David Pittman wrote that, “As policymakers take stock of the new line-up in Washington, they will consider how best to implement health care payment reform. The evidence presented below suggests that accountable care organizations (ACOs) are the best path forward. We think the data in Medicare are clear: The success of total cost of care, population-health models such as Medicare ACOs far outpaces the performance of narrowly focused alternative payment models (APMs). As leaders of the National Association of ACOs, we believe policy makers need to recognize this disparity in Medicare and stop wasting time and energy trying to develop and fine-tune other medical home and episodic-based payment models.”
Gaus and Pittman noted that, “After a decade, we have enough knowledge to know we should focus on ACOs in our delivery system reform efforts, although we recognize that there may be other models worth exploring if they don’t interfere with total cost of care models. Furthermore, we have learned during this pandemic that total reliance on a fee-for-service payment model is dangerous. As providers learn to appreciate the value of capitated payments, ACOs provide a natural bridge from fee-for-service to capitated payments.”
Among other elements in the discussion, the authors noted that “We now have eight years of experience with ACO and Center for Medicare and Medicaid Innovation (CMMI) models,” experience that shows that “Population-focused, total cost of care models, such as ACOs, incentivize all providers to work together to care for the whole patient and provide quality care throughout the continuum to address patients’ social needs, manage comorbidities, and coordinate medications.”
Among other pieces of evidence, the authors wrote that “Data from MedPAC [the Medicare Payment Advisory Commission], researchers at Harvard University, and the analytic firm Dobson DaVanzo and Associates show that ACOs are lowering Medicare spending annually by 1 percent to 2 percent. Knowing Medicare Parts A and B cost $636 billion in 2018, a 2 percent reduction in spending would save nearly $200 billion when compounded over a decade, assuming Medicare spending would grow at 4.5 percent per year without ACOs. Importantly,” they added, “based on the authors’ analysis of Centers for Medicare and Medicaid Services Public Use Files, ACOs also hit an average quality score of more than 94 percent in 2019, the latest year for which Medicare data are available. Also, the Office of Inspector General found that ACOs outperformed fee-for-service providers on most quality measures and improved quality over time in the program. Finally, stories from the experiences of ACO care during the pandemic illustrate the advantages of being responsible for the whole patient and using state-of-the-art data and care coordination best practices.”
NAACOS’s press release, summarizing some of the available data, references those statistics around a projected $200 billion in savings, as well as these other findings:
Ø CMS’s Bundled Payments for Care Improvement found Medicare spending increased after payments to participants were reconciled. Comprehensive Primary Care Plus was found to have fee-for-service spending 2 to 3 percent higher than comparison practices after accounting for incentive payments.
Ø MedPAC estimates Medicare Advantage enrollees cost on average about $1,000 per patient per year more than traditional Medicare patients. Conversely, the commission estimates Medicare ACOs are reducing costs by 1 to 2 percent compared to traditional Medicare.
Ø ACOs hit an average quality score of more than 94 percent in 2019. Also, the Health and Human Services Inspector General found ACOs outperformed fee-for-service providers on most quality measures and improved quality over time in the program.
Ø Based on interviews with selected organizations, population-focused organizations like ACOs are uniquely positioned both to early identify patients at risk and to manage the comorbidities of COVID-19 pandemic survivors.
Ø ACOs offer a way for independent physician practices to receive the benefits of operating in a larger organization without having to merge with a hospital or health system.
As the press release notes, “NAACOS this week congratulated President-elect [Joe] Biden and Vice President-elect [Kamala] Harris on their victory and urged the new administration to prioritize payment and delivery system reform in its work. In its upcoming work, policymakers should look for areas of bipartisan agreement, and advancing value-based payment is one area ripe for attention. The Biden-Harris administration should act on ways to promote participation in and savings from alternative payment models like ACOs.”
