CMS/CMMI Pioneer ACO Model AAMC Contacts: Karen Fisher, J.D. Jane Eilbacher

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1 CMS/CMMI Pioneer ACO Model AAMC Contacts: Karen Fisher, J.D. Jane Eilbacher Updated 6/16/11

2 CMS Objective for Pioneer ACOs To design an ACO program for more advanced systems: those organizations already experienced in coordinating care for a significant portion of patients under risk sharing contracts who will be able to more rapidly transition to an ACO model The Pioneer ACO will complement the MSSP ACO and inform MSSP ACO development, providing a platform for CMMI to test new ideas and concepts that could eventually be incorporated into the MSSP 2 Updated 6/16/11

3 Timeline/Key Dates Notice of Request for Applications (RFA): Released May 17 Letter of Intent (and Data Use Agreement): Due June 30 to Pioneer ACO Model Application: Postmarked on or before August 19 CMS will only consider applications from organizations that have submitted letters of intent Interview of Semi-Finalists: 1-2 months after application deadline Program Tentative Start: 3 rd or 4 th quarter of 2011 (CMS says it will provide comfortable interval between acceptance into program and program start date) 3 Updated 6/16/11

4 Pioneer ACO vs. MSSP ACO Pioneer ACO Administered Through CMMI CMS Type of Program Demo/pilot, CMMI expects to initially partner with 30 Pioneer ACOs MSSP ACO Participation Period Up to 5 years 3 years Program (i.e. option under Medicare program like Medicare Advantage) Maximum Shared Savings Up to 75% of savings Up to 60% of savings Minimum Beneficiaries 15,000 5,000 Beneficiary Attribution Method Role of Specialists in Attribution Other Payer Involvement Minimum Savings/Loss Rate Prospective or retrospective Hybrid primary care and specialty attribution End of year 2, commitments made/signed contracts so that majority of all ACO revenue will come from outcomes-based 1% and share in first dollar savings/ Retrospective Primary care only Encouraged but not required % and share in savings after 2.0% (1-sided); 2.0% and share in first dollar savings/ (2-sided) 4 Updated 6/16/11

5 Hybrid Attribution Model: Primary Care and Specialty Beneficiaries will first be aligned with the group of primary care providers (same as MSSP, but including NPs and PAs) who billed for the plurality of primary care allowed charges during combined 3 year period o Group=NPIs under a TIN; thus one physician may not have the plurality, but if that physician s group has the plurality the beneficiary will be assigned If a beneficiary had less than 10% of E&M allowed charges billed by primary care physicians (in or out of the ACO), alignment will be with the group of eligible specialists who billed for the plurality of allowed charges Eligible specialties: nephrology, oncology, rheumatology, endocrinology, pulmonology, neurology, and cardiology Beneficiaries will be assigned each year 5 Updated 6/16/11

6 Payment Methodology Multiple payment arrangements: o Core Payment Arrangement as set forth in RFA Core Arrangement, Core Option A, and Core Option B o Alternative Payment Arrangements: CMS encourages applicant Pioneer ACOs to propose alternative payment models CMS will distill and synthesize these suggestions to develop the Alternative Payment Arrangement(s) which Pioneer ACOs can select instead of one of the Core Payment Arrangement options 6 Updated 6/16/11

7 Core Payment Arrangement Performance Period 1 Performance Period 2 Performance Periods 3, 4, 5 Core Arrangement OR Up to 60% shared Up to 70% shared Population-based payment, with up to 70% shared savings and shared 10% maximum* 15% maximum 15% maximum Core Option A Up to 50% shared Up to 60% shared Same as Core Arrangement 5% maximum 10% maximum Core Option B Up to 70% shared Up to 75% shared Population-based, up to 75% shared Source: RFA p % maximum 15% maximum 15% maximum *The max amount of shared savings or received /incurred is capped at a set percentage of an ACO s total Parts A and B spending. 7 Updated 6/16/11

8 Expenditure Benchmark Based on weighted prior 3 year average of actual expenditures for each of ACO s aligned beneficiaries, most recent year weighted most heavily (60%, 30%, 10%) Includes IME and DSH, but not DGME payments This baseline will be increased by average percentage growth rate (50%), and absolute dollar equivalent of growth rate (50%) for a national reference population ( matched cohort ) o The national reference population will have beneficiary characteristics that are similar to the Pioneer ACO s population o It will be adjusted for age, sex, and potentially other characteristics 8 Updated 6/16/11

9 Performance Periods 3 through 5 If ACO generates minimum annual average savings over years 1 and 2 (which will vary based on whether ACO is in a high or low cost state): o Payment will transition to population-based payment in year 3 ACO providers will receive 50% of FFS payment on submitted claims; the remainder will be provided to the ACO as per-beneficiary-per-month payment based on projections 9 Updated 6/16/11

10 Participation of Other Purchasers Pioneer ACOs must commit to entering outcomesbased contracts with other purchasers (private health plans, state Medicaid agencies, and/or self-insured employers) such that the majority of the ACO s total revenues (including from Medicare) will be derived from such arrangements, by the end of the second performance period in December RFA p.13 Outcomes-based contracts: include financial accountability, evaluate patient experience of care, and include substantial quality performance incentives Pioneer ACOs will satisfy this requirement by having commitments with a go live date or signed contracts by the end of year 2; not necessary to be deriving revenue from these contracts by the end of year 2 10 Updated 6/16/11

11 Other Pioneer ACO Provisions Quality o Performance measures and quality incentive calculations will be the same as in MSSP ACO final rule o Pioneer ACOs may withdraw from the program if they find the MSSP ACO final rule quality requirements unacceptable Governance o Governing body must include meaningful representation from consumer advocates and patients o Exception to consumer advocate/patient requirement: extenuating circumstances, such as existing legal restrictions 11 Updated 6/16/11

12 Application Scoring Domains Experience with risk sharing and outcomes-based contracts Performance capabilities Potential for meeting triple aim Selection Factors (Examples) % of patient revenues in risk sharing arrangements and outcomes based contracts Degree of financial risk in applicant s 2 largest contracts as % of ACO s revenues Applicant s financial stability Primary care capability HIT Infrastructure on provider and pop. level Strength of community relationships Proposed care improvement plan Potential for cost savings, quality improvement Maximum Score Leadership & management Patient Centeredness Strength of executive credentials Leadership commitment Managerial and staff resources Ensuring patient access, care transitions Patient engagement and activation Vulnerable populations Serve dually-eligible beneficiaries Collaboration with diverse group of providers (i.e. safety net, behavioral and mental health) 5 Total Points Updated 6/16/11

13 Questions/More Information CMS is encouraging stakeholders to questions to: CMMI Pioneer ACO Website: AAMC ACO Website: 13 Updated 6/16/11

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