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CMS extends Next Generation deadline a year due to COVID-19

CMS also announced changes to other alternative payment models to adjust for the COVID-19 pandemic.

Susan Morse, Managing Editor

The Centers for Medicare and Medicaid Services has extended the deadline for the Next Generation risk model for accountable care organizations for a year due to the coronavirus.

CMS also announced changes to other alternative payment models to adjust for the COVID-19 pandemic.

Modifications include mitigating losses for Next Generation ACOs by the percentage of months in the public health emergency, allowing participants of bundled payment models the option to be excluded from payment reconciliation for 2020 and providing an opportunity for entities to enter Direct Contracting with an April 1, 2021 start date.

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CMS is offering a second round of applications to participate in the Direct Contracting Model starting in 2022.

CMS has yet to release information on the application period for the April 2021 start date.

ACOs also need more detail about the model's financial aspects, such as how spending benchmarks will be set and how populations will be risk adjusted, the National Association of ACOs said.

WHY THIS MATTERS

ACOs have been concerned about how COVID-19 will impact financial losses in their risk models.

Premier said the changes were urgently needed relief for healthcare providers in advanced alternative payment models that bear a significant amount of risk.

CMS has been pushing ACOs to take on more risk, sooner, and is offering the benefit of qualifying as an advanced alternative payment model to meet the requirements of MACRA. Next Generation is an advanced ACO model of highest risk.

The year's extension offers Next Gen ACOs an advanced APM to participate in for 2021. NAACOS said it hopes the additional year will give CMS more data on which to make the Next Gen model permanent.

THE LARGER TREND

Next Gen ACOs have successfully met the CMS Innovation Center's goals of improving care quality while lowering Medicare spending, the National Association of ACOs said. Next Gen ACOs collectively saved $406 million in 2018 and $337 million in 2017.

ON THE RECORD

"Going forward, value-based care can help ensure healthcare resiliency," CMS Administrator Seema Verma said in a Health Affairs blog post announcing the changes "By accepting value-based or capitated payments, providers are better able to weather fluctuations in utilization, and they can focus on keeping patients healthy rather than trying to increase the volume of services to ensure reimbursement. Value-based payments also provide stable, predictable revenue – protecting providers from the financial impact of a pandemic."

Premier said, "These changes will enable participants to stay in the models so that we do not lose progress in the movement to value-based care."

"Ensuring providers have the time to evaluate and remain in value based care programs is critical," said Michael Gleeson, chief strategy and innovation officer at Arcadia. "These structures are critical to the future financial stability of provider organizations – allowing for more flexibility for providers to invest resources where they can have the most impact on patient health."

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com