CMS headquarters-Windsor Mill, Maryland
Starting in 2018, clinicians may join an advanced alternative payment model to earn incentive payments under the Medicare Access and CHIP Reauthorization Act.
Rural hospitals are also allowed to participate in the new Track 1+ ACO model.
The Centers for Medicare and Medicaid Services Innovation Center announced the new ACO model in December, and offered details this month.
The new ACO model is designed to get smaller practices into a model that satisfies the advanced alternative payment model under MACRA.
Smaller practices may be attracted by the more limited downside risk associated with the Medicare ACO Track 1+ model, than with than the current Tracks 2 or 3 of the Medicare Shared Savings Program.
The new model is similar to Track 1, but incorporates elements of Track 3, including having knowledge in advance of the patient population for which the ACOs are responsible, and the option to request a skilled nursing facility three-day rule waiver.
Physicians and other stakeholders had requested this type of ACO model, CMS said.
To be eligible for the Track 1+ Model, an ACO must also be participating in Track 1 of the shared savings program. ACOs in Tracks 2 and 3 are not eligible.
CMS said it wants the model to be a pathway for ACOs to enter two-sided risk and then move on to higher risk in a Track 2 or 3 model. CMS is limiting participation in the new model to one three-year agreement.
ACOs can share in savings up to a maximum 50 percent shared savings rate based on quality performance. The model has a fixed 30 percent loss sharing rate, CMS said.
The maximum level of downside risk varies based on the ACO, with lower levels of risk potentially available to qualifying, physician- only ACOs and those that include small rural hospitals.
Track 1+ ACOs will be in one of two risk arrangements, either revenue or benchmark-based, depending on qualifying criteria.
If the loss sharing limits are not met, the loss sharing limit is 8 percent of Medicare fee-for-service revenue in year one. The standard increases in years two and three.
If at least one of the criteria is met, the loss sharing limit will be 4 percent of the ACO's updated historical benchmark, a potentially higher level of risk than the revenue-based loss sharing limit for ACOs that are providing a larger portion of total Part A and B revenue for the Medicare fee-for-service beneficiaries.
ACOs can join the Track 1+ Model as part of the 2018, 2019 and 2020 application cycles that align with Shared Savings Program Tracks 1, 2 and 3.