May 01, 2020

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On Thursday April 30, CMS released a second round of extensive regulatory changes and waivers in response to the COVID-19 pandemic. This latest interim final rule builds on the first CMS COVID-19 interim rule from late March and provides a much more comprehensive plan for Shared Savings Program ACO relief as providers face the disruption of the COVID-19 pandemic. In making these changes, CMS is acknowledging the real risk of the pandemic on the future of ACOs and is appropriately taking urgent action.

This new rule makes it clear that CMS has heard the concerns of ACO advocates, including Caravan Health. Since our clients have been managing the stresses of the pandemic, we have been pushing for ACOs to be freed from having to make big decisions about participation, particularly around taking on higher levels of risk. The highlights are below.



No required move to higher risk in 2021.
CMS is allowing ACOs to remain in their current risk levels for 2021. Any ACO with an agreement period expiring at the end of 2020 can extend their participation by one year under the same benchmark. This gives the 160 ACOs that started in 2018 some breathing room, so they don’t have to spend time and resources working on ACO renewal. These ACOs will have until September to decide whether or not to extend. This includes participants in Track 1 ACOs that would otherwise have had to switch to the Pathways program.

ACOs in any Pathways to Success Basic Track can elect to defer advancing to the next level of risk for 2021. This allows ACOs to focus on patient care, rather than redesigning care process or making other structural changes to prepare for risk during the pandemic. CMS is not forcing ACOs to freeze their risk level, any Basic Track ACO can choose to continue along the risk path, either at the normal pace or an accelerated pace.

Though the risk advancement of these ACOs can be deferred for 2021, the program is not entirely frozen. ACOs can still add or remove participants, apply for a SNF 3-day rule waiver, establish a beneficiary incentive program, or elect to change their assignment methodology for PY 2021. For Basic Track ACOs that elect a 2021 risk deferral, in 2022 they will advance to the level they would have if they had advanced for 2021. After effectively freezing in place for one year, the ACO will move over that skipped risk level and continue on the glidepath.

No application cycle for 2021 - But you can still join an existing collaborative ACO.
Since ACOs with expiring agreement periods will not have to renew, CMS is forgoing the application cycle for 2021. With no new ACO starts in 2021, PY 2020 will not serve as benchmark year 3, the year with the highest weight, for any ACO.
 
Disregarding COVID-19 costs in ACO financial calculations.
CMS is adjusting the financial methodology so that ACOs are not rewarded or penalized for having higher or lower incidence of COVID-19 in their communities. CMS will disregard any costs associated with COVID-19 inpatient treatment. This is intended to prevent a windfall, via an inflated benchmark, to ACOs due to the temporary nature of high COVID-19 costs as well as to relieve ACOs of COVID costs if they were severely affected. However, it’s not clear that CMS is similarly accounting for lower volume to due cancelled to deferred elective procedures. CMS estimates that this could account for a 20% drop in expenditures, which could have a significant effect on an ACOs benchmark.

Expanded timeframe for disregarding losses.
The first interim final rule allowed ACOs to disregard any ACO losses for the duration of the COVID-19 public health emergency, starting in March 2020. Many advocates found this insufficient, since it would leave ACOs open to the possibility of facing shared losses for circumstances out of their control in 2020. This new interim rule pushes that March date back to January 2020, when the PHE was officially declared. If the PHE continues through the rest of 2020, no ACO will be on the hook for any shared losses this year.  

More primary care services count for patient assignment.
CMS recognizes that the pandemic could have serious implications for beneficiary assignment during a year when patients are unlikely to visit their doctor’s office in person for preventive primary care services. CMS is expanding the definition of primary care services that count for patient assignment to include telehealth codes for virtual check-ins, e-visits, and telephonic communication.

Reimbursement parity: audio-only and in-person visits.
CMS had previously expanded the availability of services delivered by audio-only communication. This interim final rule broadens the availability of those services and increases payment to match that for in-person visits.

More kinds of providers can participate in telehealth.
CMS previously expanded the list of telehealth allowable services to include certain therapies, but many therapists were not allowed telehealth providers. This rule fixes that oversight by expanding telehealth-eligible providers to include physical therapists, occupational therapists, and speech language pathologists. Additionally, RHCs and FQHCs can bill for telephone only codes using their new telehealth code (G2025), which brings these services to those who need them most.

Expanded access to COVID-19 and other testing.
This rule will expand at-home and community-based viral testing to minimize transmission of COVID-19 among Medicare and Medicaid beneficiaries. A doctor’s order will no longer be required for beneficiaries to get COVID-19 and other viral illness tests.

Changes to remote patient monitoring requirements.
This rule will reduce the number of required days for remote patient monitoring from 16 to 2. This change recognizes that RPM needs may be briefer and perhaps more intense in COVID-19 patients.
 
The rule includes much more beyond these specific changes. The rule further expands hospital and provider capacity, makes many more changes to telehealth and virtual care availability, and gives Medicare providers relief from various reporting and audit requirements.

This rule represents a complex set of changes for ACO participants and those considering participation. More regulatory action and even legislation is possible later this year. ACOs and their providers should not have to focus resources on preparing for risk or applying to the program while the country battles a pandemic.
 

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