Maximizing Benefits: How the Medicare Shared Savings Program Enhances Care and Cuts Costs

How does the Medicare Shared Savings Program (MSSP) optimize healthcare costs while ensuring high-quality care for patients? This initiative empowers healthcare providers to form Accountable Care Organizations (ACOs) that strive for better patient outcomes and reduced expenses. By achieving quality care benchmarks and spending efficiently, ACOs in the MSSP can earn shared savings, reflecting the program’s commitment to cost-effective care. This article unpacks the structure, incentives, and impact of the Medicare Shared Savings Program, providing a roadmap for understanding how it benefits both providers and Medicare beneficiaries.

The Medicare Shared Savings Program (MSSP) aims to improve care efficiency and quality while promoting responsible healthcare spending, using mechanisms like Accountable Care Organizations (ACOs) that are rewarded for performance in cost reduction, patient experience, and quality care.

ACOs participating in the MSSP receive financial incentives for providing high-quality care and reducing Medicare Part A and B expenses, but also face risks, as failing to meet quality performance standards can disqualify them from shared savings despite cost reductions.

The MSSP provides a range of participation options with varying levels of risk and reward to cater to the unique needs and capabilities of ACOs, emphasizing accountability and improvement in care delivery through data transparency and support resources such as the CMS ACO Learning System.

Exploring the Basics of the Medicare Shared Savings Program (MSSP)

The MSSP is a beacon of change in the healthcare landscape, encouraging investment in healthcare infrastructure and redesigned care processes. It aims to:

  • Elevate efficiency and service quality for Fee-for-Service (FFS) items and services
  • Ensure that spending healthcare dollars is both prudent and effective
  • Include alternative payment models, like Accountable Care Organizations (ACOs), that reward organizations for their performance in quality, cost reduction, and patient experience.

Fundamentally, the MSSP strikes a balance between cost and care. It fosters an environment where the Centers for Medicare & Medicaid Services (CMS) and healthcare providers work hand-in-hand to ensure Medicare beneficiaries receive high-quality care without spending healthcare dollars excessively. The shared savings program ACOs represent a promising shift in healthcare delivery, focusing on:

  • patient outcomes
  • quality of care
  • coordination of services
  • preventive care

Rather than the number of services provided, focusing on avoiding unnecessary services can lead to better outcomes and help in eliminating unnecessary services.

The Goals of MSSP

The MSSP encourages ACOs to:

  • Promote accountability for the quality of patient care
  • Synchronize care and channel resources into efficient, superior services
  • Emphasize appropriate spending, rather than minimizing expenses
  • Improve health outcomes without restricting future care
  • Align with improving population health and promoting coordinated care initiatives across providers

These goals embody a broader vision beyond individual patient care.

The MSSP targets strategic and patient-centric cost reductions. They aim to avoid unnecessary test repetitions, strengthen preventive care, and promote better care coordination. This approach has resulted in hospitals participating in the MSSP experiencing increases in net patient revenue and Medicare revenue without significant changes in operating margins. This indicates the potential for financial benefits coinciding with the enhancement of patient care.

Incentives for Providers

The MSSP extends beyond beneficiary care, offering substantial incentives for healthcare providers. ACOs in the MSSP are rewarded for both high-quality care and efficient use of healthcare dollars. If they meet specific quality performance standards and demonstrate a reduction in Medicare Parts A and B expenditures compared to their benchmark, they may qualify for shared savings.

Yet, these rewards are not without their associated risks. If ACOs fail to meet the set quality performance standards, they become ineligible to receive shared savings, regardless of their success in reducing costs below benchmark levels. Thus, the incentive structure within the MSSP enables ACOs to earn more shared savings as they improve the quality of care, with the condition that they also limit the growth of healthcare expenditures. This emphasis on quality and efficiency is the cornerstone of the MSSP.

Understanding Accountable Care Organizations in MSSP

ACOs hold a crucial position in the MSSP. Groups of doctors, hospitals, and other healthcare providers join together to provide coordinated, high-quality care for Medicare beneficiaries. They collaborate voluntarily to ensure better outcomes for patients. ACOs are responsible for the quality, cost, and experience of care for their assigned Medicare fee-for-service (FFS) beneficiary population.

Hospitals’ active involvement in the MSSP attests to the program’s effectiveness. It has been associated with an increase in Medicare revenue share, indicating that the program has not deterred hospitals from serving Medicare patients. In fact, it contributes to maintaining their access to care.

Structure of ACOs

ACOs represent a distinctive mixture of diverse healthcare providers, including other healthcare providers. The structure of ACOs encompasses a wide array of healthcare providers such as:

  • Hospitals
  • Primary care physicians
  • Specialists
  • Facilities for post-acute care
  • Home care services

These diverse entities come together with a common goal: delivering high quality care by providing coordinated, high-quality care to Medicare beneficiaries through the Medicare program.

The formation of an ACO is voluntary, and providers have significant liberty in the development of their infrastructure. This flexibility can lead to diverse leadership roles amongst provider organizations. However, providers wishing to participate in the Shared Savings Program must join an ACO, which must have a formal legal structure and a minimum of 5,000 Medicare fee-for-service beneficiaries.

Accountability and Performance

Beyond providing high-quality care, MSSP’s ACOs aim to deliver timely and appropriate care, steering clear of superfluous services and medical errors. This focus on efficiency and quality is the bedrock of ACOs’ success in the MSSP.

The CMS employs a sliding scale to evaluate ACO performance, where higher performance scores lead to an increased share of savings for the ACO, including performance payments. ACOs are incentivized financially to reduce the growth in Medicare Parts A and B expenditures by meeting or exceeding established quality performance standards.

Annual financial reconciliation is conducted by CMS to assess ACOs’ financial performance, taking into account quality performance, and to determine their eligibility for shared savings.

Navigating Participation and Choices in MSSP

Within the MSSP, ACOs can choose between two tracks: the BASIC or the ENHANCED track. Each track offers different levels of risk and potential rewards for ACOs. The BASIC track allows eligible ACOs to begin with a one-sided model and progressively move through levels of increasing risk and reward. On the other hand, the ENHANCED track provides the highest level of risk and potential savings compared to the BASIC track.

These tracks cater to the diverse needs and capabilities of ACOs. They provide options for ACOs to choose the path that aligns with their organizational goals and risk tolerance, making the MSSP a versatile and flexible program.

Participation Options

Providing a range of participation options, the MSSP caters to the distinct requirements and goals of ACOs. Each ACO can choose from several different risk models, determining the level of shared savings or losses they may face, with higher risk models offering potentially greater rewards.

The participation options also include upside and downside risk arrangements. Upside-risk arrangements allow ACOs to share in any savings without a penalty if costs exceed benchmarks. Downside-risk contracts may require ACOs to repay a portion of losses for exceeding cost targets. Thus, the MSSP provides a balanced framework of risk and reward, encouraging ACOs to strive for efficiency and high-quality care.

Impact on Patient Care

Choosing between the Basic and Enhanced tracks in the MSSP profoundly affects how ACOs manage care, assess quality, and allocate resources to enhance patient outcomes while reducing costs. ACOs in the Enhanced track face higher stakes with increased risk and possible rewards, leading them to make more substantial investments in care management and adopt innovative care delivery models.

Continuity is crucial for ACOs in delivering consistent preventive services. This is evidenced by the drop in annual health checks for patients with diabetes after an ACO leaves the program. This highlights the importance of sustained participation in the MSSP for maintaining a high standard of patient care.

Data Transparency and MSSP Success

Data transparency forms a key element of the MSSP. You can access data on Shared Savings Program ACOs from resources such as Data.CMS.gov. This information is publicly available for review and analysis. This transparency facilitates the measurement of ACO success and provides valuable insights into the program’s performance.

CMS also provides ACOs with initial and ongoing data on their assigned population and financial performance. This data is a key tool for managing patient care effectively. Shared Savings Program ACOs can request monthly Claim and Claim Line Feed (CCLF) files on Medicare FFS beneficiaries, further aiding in the coordination of care. The continuous sharing of performance data ensures ACOs are informed about their performance, promoting accountability and the improvement of care delivery.

Utilizing Program Data

Annually, ACOs must submit specific measures on patient experience, care coordination, safety, and preventive health to CMS. This quality of care assessment is based on patient surveys and clinical data, ensuring comprehensive coverage of the health services provided.

Advanced data analytics and IT capabilities are indispensable for ACOs to efficiently identify high-risk patients and enhance coordination across care settings, which supports the streamlining of quality reporting. ACOs receive detailed annual reports on financial and quality performance, which guide adjustments and improvements in care delivery for the subsequent performance year.

Learning from the CMS ACO Learning System

The CMS ACO Learning System offers useful resources to assist ACOs in effective quality data reporting. The APP Toolkit is an example of these resources. Quality measurement and the Alternative Payment Model Performance Pathway (APP) are integral to the Shared Savings Program. Their goals are to lessen reporting burdens and promote engagement in Advanced Alternative Payment Models.

By providing these resources, the CMS ACO Learning System supports ACOs in navigating the complexities of the MSSP and maximizing their success in the program.

The Beneficiary Experience with MSSP

Preserving patient choice stands as a foundational principle of the MSSP. Beneficiaries in the Medicare Shared Savings Program maintain their liberty to choose any Medicare provider. This freedom of choice is integral to the MSSP, as ACO involvement strives to bolster care quality and efficiency for patients, while ensuring individuals can still select their healthcare providers freely.

The transition of a provider to an ACO under the MSSP does not modify the patient’s Medicare benefits, coverage, or premium structure. Moreover, ACOs provide additional health services like at-home visits and telehealth options, particularly beneficial to those in underserved regions.

Enhancing Patient Care

In the MSSP, ACOs hold a key role in improving patient care. They prioritize primary and preventive care, such as establishing and operating a Beneficiary Incentive Program, to address health concerns early and potentially reduce severe and expensive outcomes.

The MSSP promotes the use of evidence-based medicine, with ACOs utilizing it as a standard of care through resources like AskMayoExpert to improve patient outcomes.

Effective ACOs:

  • Coordinate care
  • Efficiently deliver low-cost services
  • Have a robust network
  • Implement strategies for managing chronic conditions
  • Reduce the likelihood of hospital readmissions and unnecessary ER visits.