H.R. 6101 – The ACO Improvement Act of 2016

Sponsored by Rep. Diane Black (R-TN) and Rep. Peter Welch (D-VT), this legislation provides sensible modifications to the Medicare Share Savings Program (MSSP) program, including operational changes that will benefit Medicare beneficiaries by promoting coordinated health care and allow Medicare ACOs to succeed and remain a viable business model.

Improving Outcomes Through Greater Beneficiary Engagement

Providers may offer certain incentives to encourage primary care visits and ease the burden of follow-up and maintenance visits. CMS would have the discretion to revoke these waivers if misuse or abuse is discovered. 

Waivers for all ACOs, regardless of track, on cost-sharing, telemedicine & remote monitoring

In order to encourage beneficiaries to take advantage of primary care services, ACOs can waive patient visit co-pays if the ACO assumes the cost of the co-pay, which is not currently allowed. 

Waiver of originating site restrictions for telemedicine & remote monitoring

Using telemedicine and remote monitoring services provides convenient and cost-saving ways to continue patient-provider engagement. Currently, Medicare places limitations on the location of a beneficiary at the time the telemedicine service is provided.  H.R. 6101 would remove such limitations and allow ACOs to pay for services such as video-conferencing with beneficiaries in connection to providing home health services. 

Beneficiary choice of primary care provider within ACO

Because ACOs often have several providers, beneficiaries can choose which primary care provider within the ACO they wish to be assigned. This fosters familiarity between provider and patient and adds to greater coordinated care.

Regulatory Relief for Two-Sided ACOs

These provisions are designed to alleviate regulatory burdens on ACOs in two-sided risk models. CMS would have the discretion to revoke these waivers if misuse or abuse was discovered. 

Waiver of the required 3-day hospital stay for skilled nursing facility (SNF) services Medicare typically requires that beneficiaries have a prior inpatient hospital stay of no fewer than three consecutive days in order to be eligible for Medicare coverage of inpatient SNF care. This provision would waive the requirement for the 3-day inpatient hospital stay and allow ACO beneficiaries to receive SNF services without first having the 3-day inpatient hospital stay. 

Waiver of the homebound requirement

For a patient to be eligible to receive covered home health services under both Medicare Part A and Part B, Medicare requires that a physician certify that the patient is confined to his/her home and must meet certain criteria to be confined to the home or homebound. This provision would provide a waiver to two-sided ACOs to allow the ACO’s beneficiaries to receive home health services without meeting the Medicare homebound requirements.

Operational Flexibility for ACOs

Choice of prospective or retrospective assignment of beneficiaries

Under prospective assignment, the patient population is assigned to the ACO at the beginning of the performance period. With retrospective assignment, patients are assigned at the end of the performance period. ACOs may elect which way they prefer at the beginning of the year and is the best strategy to provide care for their patient population and achieve cost savings while reaching (or surpassing) set quality standards. 

Ability to move up tracks annually

Some ACOs may find themselves in the position to assume greater risk in order to receive a greater percentage of shared savings.  Currently, ACOs can only move up tracks every 3-year contract period. This provision would allow ACOs the opportunity to move up tracks every year as opposed to every 3-year contract period. 

Allowing some non-physician providers and FQHCs to be assigned beneficiaries 

This provision will allow greater access to primary care in rural and medically underserved areas by expanding practices and providers that can participate in the MSSP program. 

De minimis variation from 5000K lives permitted

Currently, the minimum assignment to participate in the MSSP is 5000 lives.  From year to year, ACOs may experience beneficiary “churn” or beneficiaries moving in and out of an ACO.  This provision would allow ACOs with no fewer than 4900 lives covered remain eligible to participate in the MSSP as long as other eligibility conditions met.

Structure for Distribution of Internal Shared Savings

Gain-sharing arrangement structure

In a collaborative care setting, the arrangement made between 2 providers where if the care delivery from the 1st group results in decreasing costs and increasing the 2^nd group’s profit margin, the 1^st group may share in the increased profits. Currently, the ACO statute is silent on internal cost savings. This provision allows bundlers to share both the savings check from CMS as well as internal cost savings. If the ACO doesn’t achieve savings under the MSSP, they can still honor contracts with doctors to gain-share on increased margins due to internal cost reductions.

Miscellaneous Provisions Benefitting ACOs

Bonus payments for quality achievement and for quality improvement

Currently, ACOs are only rewarded for achieving savings and all of the quality standards, with no reward for year-to-year quality improvement.  ACOs who reach the top half of the quality performance measures or the quality improvement measures may be rewarded up to 10 percentage points of additional shared savings on a sliding scale basis. 

2-way risk adjustment demonstration project

A three-year demonstration project is established to provide a way to adjust from year to year for differing acuities in populations.  As a population gets older, they may become more ill and the risk factor must be adjusted to reflect the increasing cost of care. Risk scores are allowed to be shifted down, not increased. 

Study on feasibility of providing electronic access to Medicare claims

A study will be conducted on the feasibility of providers having secure electronic access to patient claims data and the needed measures to protect beneficiary and provider privacy. More efficient access to claims data is critical to effective population health management.  The system could be a modification of an existing system, such as the Virtual Research Data Center. The Secretary must submit a report and recommendations no later than 6 months after date of enactment.