September 9 2024- Today, the National Association of ACOs filed comments in response to the proposed 2025 Medicare Physician Fee Schedule rule, which makes several updates to the Medicare Shared Savings Program, Medicare’s largest alternative payment model. Among the favorable policies supported by NAACOS include:

• Efforts to exclude all payments associated with CMS-identified significant, anomalous, and highly suspect (SAHS) billings from ACOs’ financial calculations
• Allowing ACOs to elect to receive prepaid shared savings payments
• Adding a Health Equity Benchmark Adjustment that would upwardly adjust benchmarks for ACOs
• Creating new billing codes for Advanced Primary Care Management services
• Creating a process by which ACOs can request CMS recalculate shared savings and losses to account for improper payments identified

However, the proposed rule does not address two significant issues within the Medicare Shared Savings Program. This includes:

• The lowering of ACOs’ financial benchmarks over time. Because ACO benchmarks are predominantly based on the historic spending of their patients and ACOs have generated more than $22 billion in gross savings over the past decade, ACOs’ financial spending targets are reaching unsustainable levels. NAACOS asks that CMS seek multi-stakeholder input on the overall financial goals of alternative payment models, reasonable comparison groups for defining success, and redesigning benchmarks to attract new participants and maintain current participants.
• Challenges with the model’s quality reporting mechanisms. Specifically, CMS currently plans to sunset the predominant way in which ACOs report quality and require all ACOs to report promoting interoperability requirements beginning next year. Even by CMS’s own admission, navigating these polices will be difficult for ACOs. The result of these policies is that ACOs have and will continue to remove practices, particularly smaller and independent practices. Scores of ACOs and eight national health associations, including NAACOS, submitted a separate, detailed letter to CMS outlining recommendations for improving the quality reporting process.

About NAACOS. The National Association of ACOs (NAACOS) represents more than 9.1 million beneficiary lives through Medicare’s population health-focused payment and delivery models. NAACOS is a member-led and member-owned nonprofit of more than 470 ACOs in Medicare, Medicaid, and commercial insurance working on behalf of health systems and physician provider organizations across the nation to improve quality of care for patients and reduce health care cost.