The number of ACOs has risen 11 percent since early 2016 and other alternative payment models are also growing, as MACRA implementation pushes the trend, according to a new Health Affairs study.
Since early 2016, 138 new ACOs have began operating and 46 dropped their accountable care contracts, representing a net increase of 92 organizations, according to authors David Muhlestein, Robert Saunders, and Mark McClellan.
By early 2017, there were 923 public and private ACOs covering more than 10 percent of the population.
The number of contracts has grown to 166 and the pace of growth has been similar for all payer types.
Commercial represents the largest at 59 percent. Of 1,366 contracts, 715 are in commercial insurance, 563 are in Medicare and 88 are in Medicaid.
Although fewer providers participate in ACOs than in any other type of alternative payment model, the majority of dollars paid through APMs flow through ACOs that cover patients' total cost of care, the study said.
In 2016, 25 percent of healthcare dollars were in shared-savings and shared-risk ACOs, episode-based models and partially and fully-capitated payments, for commercial plans, Medicare Advantage and Medicaid, according to information used from the Health Care Payment Learning and Action Network.
For Medicare, these APMs represented over 30 percent of payments in 2016.
State Medicaid plans and commercial payers also expanding APMs.
This upward trend is projected to continue, depending on the direction of payment reform based on administrative and legislative action, according to Health Affairs.
Reinforcing the trend is passage of the Medicare Access and CHIP Reauthorization Act, which gives physicians a choice of participating in one of two tracks for payment, or face penalties.
While the Centers for Medicare and Medicaid Services provided physicians with administrative relief from penalties in 2017 under the Merit-Based Incentive Payment System, or MIPS track, physicians must decide whether to report under MIPS or try to participate in an APM in 2018.
As Medicare Shared Savings Program Track 1 participants are not eligible for the MACRA advanced APM bonus, it is likely that more organizations will move toward greater risk sharing arrangements, such as the new MSSP track 1+, MSSP track 3, Next Generation model, or other advanced APMs, the study said.
The expanding Comprehensive Primary Care Plus program, or CPC+, also counts as an advanced APM for primary care providers, and CMS has indicated it aims to make additional APM options available for specialized care in the coming months, the authors said.
For many clinicians, though, there are no existing Medicare APMs that cover the services for which they are responsible. To address this challenge, MACRA authorized the creation of the Physician Focused Payment Model Technical Advisory Committee, charged with recommending potential APMs to CMS. To date, many of the submissions have focused on specialized care, reflecting the interest in such models.
Episode bundled payments may help address one weakness of population-based payment models, namely that many clinicians--such as surgeons or other specialists--can have an important impact on quality and costs for specialized groups of patients, but are not well-positioned to help manage the total care of a population.
The expansion of multiple payment models has raised concern about how they interact.
One common overlap is the use of bundled episode payments for specific services within an ACO arrangement. This could be a positive combination because evidence suggests that bundles improve efficiency within a defined episode, while ACOs can help improve population health and lower overall spending, the authors said.
However, there are challenges with operating both models for the same patient, such as how to attribute cost savings within the organization or across an ACO and specialist group, if different provider organizations are involved in care for a given patient.
To avoid over-burdening physicians, it is essential that providers align non-competing interests and minimize the administrative burden of multiple payment models, the authors said.
The study shows that in general, the more populous the state, the greater the number of ACOs.
The two largely rural states of Wyoming and West Virginia have less than 2 percent of their population covered under ACOs, while two states, Rhode Island and Maine, have over 30 percent covered, even though Maine's population is less than that of West Virginia. Rhode Island has even fewer people, but is more densely populated.
Interestingly, the most populous states of California, Texas, Florida, New York, and Pennsylvania have a lower percent of lives covered than the national average, despite having some of the highest counts of ACOs, the authors said.