Reprinted from ACO BUSINESS NEWS, a hard-hitting monthly newsletter on the latest industry actions to design and create ACOs, for hospitals, physicians, health plans and their advisers.
By Jane Anderson, Editor
April 2013 Volume 4 Issue 4
Eighteen of the 32 Medicare Pioneer accountable care organizations have petitioned CMS for a one-year delay in the planned move from simply reporting quality measures to actually being paid for their performance on those measures, saying their continued participation in Pioneer will depend on CMS’s answer.
The ACOs, in a letter sent Feb. 25 to CMS, threatened to quit the program entirely if federal regulators failed to address their concerns, and sources report that CMS Administrator Marilyn Tavenner has agreed to meet with them to discuss the issue.
“Pioneers need to know before April 2, 2013, if you accept our recommendations, so that we can make informed decisions regarding our ongoing participation,” said the letter, signed in alphabetical order by more than half of the Medicare Pioneers.
At issue are the proposed quality benchmarks for performance year 2013 in the Pioneer initiative. Up until this point in the 15-month-old program, the Pioneers have needed to report 31 quality measures to CMS, but they haven’t been paid for their performance on those measures.
That’s scheduled to change this year as CMS begins using the benchmarks to determine compensation for the Pioneers. However, they say in the letter that “the metrics are not yet mature” enough to use for pay-for-performance, particularly 19 of them, which involve “flat percentage benchmarks without anchoring methodology.”
Pioneer ACOs Put Brakes on Risk
There’s too little data surrounding those 19 measures for CMS to use them now to determine the Pioneers’ compensation, the letter says. “We understand the metrics are not yet mature and want to work with you to create a credible pool of data from which to pull empirical benchmarks.”
Delaying the pay-for-performance piece by one year and using reported data from both the Pioneer program and the Medicare Shared Savings Program will help to build a usable database and shore up those measures with real-life experience, the letter says. CMS then can implement revised measures for reporting year 2014 that could be used to determine compensation.
Those 19 flat percentage benchmarks aren’t the only problem, according to the letter. For the “mature” quality measures with proven track records, “the proposed [Pioneer] benchmarks are higher than standards set in commercial contracts and in Medicaid.” Best-in-class performance often is only 70% on those mature measures, the letter states. “We suggest that using the ACO database to determine best in class performance for the new measures will help set and scale percentiles accordingly.”
Finally, the Pioneers say in their letter that they’re concerned about benchmarks that are based on experience with the Medicare Advantage program. “We believe there are fundamental differences between the experience of non-managed and managed populations that warrant consideration when establishing pay-related benchmarks,” they say.
None of the Pioneer ACOs contacted by ABN responded to questions on the letter. There’s no indication which Pioneer participant initiated the letter, but the new ACO association, the National Association of ACOs (NAACOS), had nothing to do with it, says Bruce Merlin Fried, a partner in the law firm SNR Denton US LLP, who serves as general counsel for NAACOS. Still, Fried says, “there are reasons to be raising these concerns.” He tells ABN, “My hope is that — knowing the [CMS] administration a bit — they will listen to the concerns that have been raised. I think reasonable people can agree there’s a path that probably will not resolve this perfectly for everyone, but that will not put the ACOs in a position of being held to a standard they can’t meet.”
Fried adds: “This is a brand-new program. It was just words on paper a little more than a year ago. It’s inevitable that, as the program becomes real, it will go through some changes. This quality issue is just the first one.” CMS is committed to making the Pioneer program work, and Fried says he expects a solution to be found that satisfies both the federal agency and the organizations involved.
Erik Johnson, senior vice president at Avalere Health, agrees that CMS is committed to the Pioneer program. He tells ABN that it’s possible the Pioneer ACOs are “unhappy with the quality and timeliness of the data” that CMS is sharing with them. “They’re a year into this now, and I wonder if the first-year results are so underwhelming — maybe they actually lost money — that [the Pioneers] are making every effort to make sure they have savings to share.”
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