Upcoming ACO model to have positive post-acute impact, CMS official says

Patrick Conway, M.D.
Patrick Conway, M.D.

Long-term care providers now have another accountable care model to consider, Centers for Medicare & Medicaid Services officials announced Tuesday.

The Next Generation ACO Model enables providers who want to take on more risk and enables a greater opportunity to coordinate care, said Patrick Conway, M.D., CMS's principal deputy administrator.

The model may be beneficial for those trying to offer the best post-acute setting for seniors, Conway said, specifically for reducing hospital readmissions.

“It can have a very positive effect on the post-acute arena,” he told reporters during an Association of Health Care Journalists webinar on care delivery. “Does the person need home health care or a skilled nursing facility? If you are in a partially capitated arrangement, you are incentivized to keep a person from being readmitted to the hospital, to keep them in the skilled nursing facility and then going home.”

Also of note for SNFs: The program would let beneficiaries “enter skilled nursing care without a prior hospitalization, and include modifications to expand the coverage of telehealth and post-discharge home services to support coordinated care at home,” CMS said in a follow-up statement. That would let beneficiaries potentially avoid falling into an observation stay trap, or avoid returning to a hospital after being discharged from a SNF.

Interested organizations should submit a Letter of Intent by May 1, 2015, and an application by June 1, with an intended January 2016 start date. Second round Letters of Intent and applications will be available in spring 2016.

One of the differences between current ACO models and the Next Generation model relates to financial risk, Conway said. In the past, ACO benchmarking was based on historical performance. The new version uses a hybrid model that looks at regional costs and historical data. There is greater risk for the organization, but more potential savings.

“This is for organizations that are really willing to take on financial risk for a population,” Conway said.

Additionally, the Next Generation model lets Medicare fee-for-service beneficiaries seek services and providers of their choice, as well as potentially offer lower or no-cost copayments.

“It enables beneficiary choice. It enables an ACO to provide higher care coordination to that beneficiary,” Conway said.

ACOs have been a mixed bag for healthcare providers, with many dropping out of the Pioneer program and some lawmakers, such as Rep. Diane Black (R-TN), saying they need to be reformed. However, beneficiaries have reported high levels of satisfaction and some skilled nursing providers saying they are necessary for good outcomes.