Final Rule on the Medicare Shared Savings Program

by Rachel McCann Ermer
Analyst, Sage Growth Partners

The Medicare Shared Savings Program, the Medicare Accountable Care program, has received a lot of feedback since its release in April 2011. CMS received a total of 1,320 public comments on the proposed rule. Most of the comments focused on the cumbersome governance/legal requirements and the provider savings.

CMS took those comments and made some substantial changes to the Shared Savings Program, including:

Greater flexibility in eligibility to participate in the Shared Savings Program
-Meaningful Use as a quality measure, not a participation requirement

Multiple start dates in 2012

Establishment of a longer agreement period for those starting in 2012

Greater flexibility in the governance and legal structure of an ACO
-ACOs will now be allowed to add or subtract providers within the performance period

Simpler and more streamlined quality performance standards
-Quality standards decreased from 65 to 33

Adjustments to the financial model to increase financial incentives to participate
-ACOs that achieve savings beyond the threshold intended to demonstrate statistical significance (2% to 3.9% depending upon the size of the ACO) will receive the appropriate share of the first dollar savings

Increased sharing caps

No down-side risk and first-dollar sharing in Track 1

Removal of the 25% withhold of shared savings

Greater flexibility in timing for the evaluation of sharing savings (claims run-out reduced to 3 months)

Greater flexibility in antitrust review

Greater flexibility in timing for repayment of losses

Additional options for participation of FQHCs

While this rule only applies to Medicare beneficiaries, commercial health plans are certainly looking at the MSSP to create their own ACOs to reward providers for decreasing the cost of care while maintaining high quality. With the release of this final rule, providers who wish to join an ACO and share in the savings of the cost of care can make a concrete plan of what it will take to be an ACO and what the financial rewards will be.