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In contrast to the diminishing number of ACOs, the MSSP continued to produce greater savings every year and saw its best year yet in 2019, the most recent year for which data is available. Serving 11.2 million seniors in 2019, the MSSP saved Medicare $2.6 billion and $1.2 billion after accounting for shared savings bonuses and collecting shared loss payments. Gross savings are shown below. 

 The Next Generation ACO Model, the premier accountable care model ran out of the CMS Innovation Center that emphasizes high risk and high reward, has also demonstrated great results. Serving 1.2 million patients in 2019, the model saved $559 million compared to the CMS-generated benchmarks and netted $204 million to the Medicare Trust Fund after accounting for shared savings, shared losses, and discounts paid to CMS. NAACOS urges CMS to extend the Next Gen model through 2022, giving time to install it as a permanent option for ACOs, either as a stand-alone track or option within MSSP. The model is scheduled to sunset at the end of 2021. The above results should speak for themselves and substantiate permanentizing. 

Given the success of the ACO program and need to strongly support the transition to value-based care and payment, we request HHS re-examine the balance of risk and reward for ACOs to bolster ACO growth and therefore savings to Medicare and to support high quality, coordinated patient care. Among those changes, we request that HHS and CMS reverse certain policies from a 2018 MSSP overhaul, which CMS called the ACO “Pathways to Success.” That overhaul included some damaging provisions such as a cut to the share of savings most ACOs are eligible to keep and a push for ACOs to assume risk too quickly. These policies have chilled ACO growth and should be changed. 

NAACOS also recommends that HHS focus the value transition on providers, keeping them at the center of payment models instead of implementing programs and policies to attract new players into traditional Medicare. As a telling example of CMS’s recent approach, in 2018 the agency released a model initially titled "Direct Provider Contracting," only to later drop the word “Provider.” That name change went along with an emphasis on giving favorable treatment to entice new participants, such as payers, to the model at the expense of those who have been on the frontlines of the value transition for the past decade. 

To support the ACO movement and recalibrate the value transition to center on and support healthcare providers, NAACOS recommends the following:

• Set a national goal to have a majority of traditional Medicare beneficiaries in an ACO by 2025
• Deprioritize the rush to risk and build a population health infrastructure
• Address overlap of competing payment models to prioritize total cost of care models
• Strengthen incentives to attract new ACOs and retain existing ones
• Provide meaningful funding to build infrastructure necessary to spur innovation and value through expanded advanced payments and grants 

To make progress on the broader goals listed above, NAACOS recommends enacting the following specific policy change this year:

• Adapt ACO and alternative payment model methodologies to account for COVID-19 anomalies
• Halt implementation of the Geographic Option of the Direct Contracting Model and improve aspects of the Professional and Global Options to benefit legacy ACOs/providers
• Improve the MSSP by increasing ACO shared savings rates, fixing key benchmarking and risk adjustment issues, allowing more time before requiring risk, and revisiting recently finalized quality policies
• Make the Next Generation ACO Model permanent
• Provide more timely and complete data to ACOs 

Ultimately, President Biden’s administration inherits fewer ACOs than the Obama administration left at the start of 2017, which is a trend NAACOS hopes will be reversed under your leadership at HHS. We appreciate the work of the Committee on these topics and look forward to working with the nominees.