Report from CMS Notes Caravan Health’s Central Role in Successful Payment Demonstration

CMS recently released its first evaluation of the ACO Investment Model (AIM) showing strong financial and quality performance by smaller and rural ACOs. These results support many of Caravan Health’s recommendations in our recent comment letter on CMS’ SSP ACO proposed rule. Our comments recommended that (1) smaller and rural ACOs be permitted to participate in ACOs without downside risk as long as they are achieving high quality, and (2) the shared savings rate in the early years stay at 50 percent rather than going down to 25 percent. 
 
AIM supported smaller and rural ACOs by investing start-up funds that can be paid back when the ACO earns shared savings. 47 AIM ACOs began in 2015 and 2016, two of those discontinued participation after the first performance year. AIM ACOs were selected to participate in one of two ways: either to establish ACOs in underserved areas (Test 1), or to sustain participation in the Shared Savings Program (SSP) and support the transition to two-sided risk (Test 2). AIM ACOs are relatively small, between 5,000 and 10,000 lives, with Test 1 focused more on rural providers such as smaller hospitals, federally qualified health centers (FQHCs) and rural health clinics (RHCs). 
 
This in-depth audit and evaluation of first year performance concludes that “AIM appears to have lowered Medicare spending without reducing quality.” These results are reassuring, yet unsurprising, to those of us who work with rural ACOs and have seen firsthand how these hardworking organizations support the population health of rural and underserved communities. 
 
Overall, the Test 1 AIM ACOs, where the rural providers are concentrated, reduced the cost of care by $82.8 million. The ACOs achieved these savings by reducing the number of inpatient stays, emergency visits, skilled nursing facility care, and hospice care. These reductions were measured against non-ACO beneficiaries in the same market.
 
In addition to the strong financial results, AIM ACOs saw other improvements in patient safety and overall population health initiatives. AIM beneficiaries had a reduced likelihood of 30-day hospital readmissions and hospitalizations for ambulatory sensitive conditions. Medicare beneficiaries in AIM ACOs were also more likely to have an annual wellness visit, transitional care management services, and chronic care management services. All three of these services are tied to strong preventive care and retention of beneficiaries in the ACO.
 

Caravan Health’s Leadership Role 

As mentioned in the report, Caravan Health assisted 21 of the 41 Test 1 ACOs by convening the groups of providers and guiding their daily operations with our proven population health model. Caravan is the national leader in bringing together rural health systems to implement delivery system reform. We have seen firsthand that rural providers can get results without “skin in the game.”
 
This exhibit from the report shows Caravan Health’s leadership role in the AIM program. Most of our Test 1 ACOs had Caravan Health as “primary contact” meaning that we played a major role in supporting the work of hospitals and physicians in the ACO. 




AIM ACOs Show Strong Results 

In the first year, risk-free AIM ACOs saved CMS $22.70 per beneficiary per month. In comparison, risk-bearing NextGen ACOs saved $18.20 PBPM and Pioneer ACOs saved $20.00 PBPM in their first year. There is scant evidence that risk improves performance in Medicare shared savings programs.
 
As we stated in our comment letter, we recommend that CMS does not take this program out of reach of the 20 percent of Medicare beneficiaries who live in rural America. Rural providers are an important part of Medicare ACOs, our estimates show that nearly 20,000 providers in 70 rural ACOs provide care for more than 1 million beneficiaries. Maintaining upside only participation and 50 percent shared savings will allow rural ACOs to survive.




 

Want to learn more about the future of the ACO program? Watch our webinar on the strategic implications of CMS' proposed rule.

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