ACO Transitions to APM

Cleveland Clinic’s ACO https://myclevelandclinic.org has transitioned to a new payment model introduced this year by CMS that can reduce healthcare costs by increasing the health system’s opportunities for performance-based savings.

Under the new model, Cleveland Clinic’s Medicare ACO which manages a population of 105,000 beneficiaries will assume limited performance-based downside risk if it doesn’t meet a savings threshold but will be able to share in savings based on their quality performance.

With the downside risk of a fixed 30 percent loss sharing rate comes the potential for rewards in terms of shared savings for up to 50 percent. The new model, called “Track1+” qualifies Cleveland Clinic’s Medicare ACO as an Advanced Payment Model (APM) under the “Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

This allows all participating providers to meet MACRA’s quality reporting requirements and will provide the health system with greater Medicare reimbursement for physician services starting in 2019. Also, under Track 1+, Cleveland Clinic’s Medicare ACO will know the patient’s population needs in advance and have the option to request a Skilled Nursing Facility 3-Day-Rule Waiver.

James Gutierrez M.D President and Medical Director for Cleveland Clinic’s Medicare ACO, reports, “Our results show improvement in ACO quality metrics and millions of dollars in shared savings, which makes us confident to assume more accountability and risk for the total cost of care for our Medicare patient population.”

In 2016, the ACO realized $42.2 million in savings which was a 24.5 percent increase from 2016. In 2016, the ACO received $19.9 million back in shared savings, a 19.8 percent increase over 2015, and the health system’s quality score was 96.3 percent.