When the Centers for Medicare & Medicaid Services (CMS) released the results of the first year of its Next Generation ACO (accountable care organization) model in October, a major takeaway was that both the financial savings and quality scores in year one were strong across the board.
As the CMS data indicated, 11 of 18 Next Gen ACO participants were able to earn shared savings in 2016, while the remaining seven ACOs generated losses outside a minimum loss rate and thus owed Medicare shared losses. However, in sum, the net of all gross savings and losses was about $48.3 million in savings. What’s more, all 18 ACOs in this model scored 100 percent on quality across 33 measures they were graded on.
When CMS announced the Next Gen program early in 2016, the idea was to “build up on experience from the Pioneer ACO model and Medicare Shared Savings Program (Shared Savings Program),” the federal agency said at the time. Indeed, Next Gen model participants have the opportunity to take on higher levels of financial risk—up to 100 percent risk—compared with ACOs in other current initiatives. While they are at greater financial risk, they also have a greater opportunity to share in more of the model’s savings through better care coordination and care management, CMS has stated. The two-sided risk model announced 21 participants (now down to 18 after three dropped out) when it was unveiled last year, most of which have experience in the MSSP or Pioneer model.
Over the last few years, results from different ACO models usually have had one commonality among them: the longer the organization has been in the program, the more likely they are to succeed. To this end, senior leaders at UnityPoint Accountable Care (UAC), a subsidiary of Des Moines, Iowa-based UnityPoint Health and one of the largest ACOs in the nation with a network of more than 7,750 physicians and providers in Iowa, Illinois, Wisconsin and Missouri, point to past experiences in these types of value-based programs as a core reason why the ACO is well-positioned to thrive in the Next Gen model.
Aric Sharp, vice president of UAC, says, “First and foremost, we have had a history of working within these innovative value-based arrangements through the Pioneer [program] and through MSSP Track 1. We wanted to sustain that effort,” he says. “Culturally, within our organization, we wanted to continue to push forward and give a clear vision that we are moving to value. And we wanted to do it in a model that we believed was better structured for our situation to find success.”
Sharp says there were several reasons why the Next Gen model was a fit for UAC, including prospective attribution, a recognition of risk score and how that moves over the course of the program, as well as the ability to continue and expand the use of waivers. “All of those were important elements,” he says. “We also wanted to continue to have a seat of the table with CMS in this innovative space. There is a lot of learning that goes on from other participants and from the folks at CMS. And it’s an opportunity to learn from others and share our learning, and continue in the evolution of these models. We appreciate the ability to be a part of that and with our desire to be a national model in this space, we saw Next Gen as the right fit.”
For UAC, success in the Next Gen model came quickly, as the ACO was able to generate $10.5 million in shared savings in the first year, which ranked third out of the 18 ACOs that participated in the program in 2016. UAC was also able to generate an additional $18.2 million in shared savings from other commercial payers in other value-based contracting efforts.
Other Keys to Success
No matter how prepared and how much experience an organization might have, the first year in a brand new ACO program—especially one with two-sided risk—comes with its share of challenges. As Sharp says, “We knew it would be [difficult] and we were comfortable with that because we wanted to challenge the organization to move in this direction in a meaningful way.” He adds, “It took an immense amount of focus to find success. We had to be data-driven. We used the data to reveal to us where the opportunities existed and then we brought discipline and focus around those [opportunities] to execute. That took a willingness on part of the organization to prioritize, but it also took a sustained effort and strong leadership in all of our regions to implement and prioritize as well.”