The Centers for Medicare & Medicaid Services (CMS) on Tuesday issued the 2023 Physician Fee Schedule final rule, which includes changes to the Medicare Shared Savings Program (MSSP) aimed to reverse stalled enrollment among participating accountable care organizations (ACO).

The 2,953 page final rule, which is scheduled to be published in the Federal Register on November 18, includes several provisions that CMS expects will advance equity within the MSSP.

CMS said in a fact sheet that the changes are meant to jumpstart enrollment in ACOs that participate in MSSP, include a better representation of higher spending populations, and make access to the ACOs more equitable. Data indicates that Black, Hispanic, Asian/Pacific Islander, and American Indian/Alaska Native beneficiaries are less likely to be assigned to a MSSP ACO than their non-Hispanic white counterparts.

The agency estimates that the changes will lead to Medicare savings of $15.5 billion and $650 million in higher net shared savings payments to ACOs.

Among the changes outlined in the final rule:

New advance investment payments

CMS will advance shared savings payments (or advance investment payments) to low revenue ACOs, those inexperienced with performance-based risk Medicare ACO initiatives, those that are new to MSSP, and those that served underserved populations.

The new policy, which takes effect January 1, 2024, was developed based on feedback from providers who treat rural and underserved populations that they need upfront capital to make the necessary investments to succeed in accountable care and may need more time under a one-sided model before transitioning to performance-based risk.

Under the new policy, an eligible ACO new to the MSSP and identified as being low revenue and inexperienced with performance-based risk Medicare ACO initiatives, may receive a one-time fixed payment of $250,000 and quarterly payments for the first two years of the five-year agreement period.

CMS said it will recoup the advance investment payments once the ACO begins to achieve shared savings in their current agreement period and in their next agreement period if a balance persists. If the ACO doesn’t achieve shared savings, Medicare won’t recoup the funding unless the ACO terminates during the agreement period in which it received the advance payments.

ACOs must use the payments to invest in increased staffing, health care infrastructure, and the provision of accountable care for underserved beneficiaries, which may include addressing social determinants of health. ACOs must also publicly report on their websites the amount of any advance investment payments and the actual amount spent in each of the spend plan categories.

Policy changes to ease transition to performance-based risk

For agreement periods beginning on January 1, 2024, and in subsequent years, CMS will allow ACOs inexperienced with performance-based risk to participate in one five-year agreement under a one-sided shared savings model. These ACOs may be eligible for a second agreement period within the basic track with two additional years under a one-sided model for a total of seven years before transitioning to two-sided risk. For performance years beginning January 1, 2023 and January 1, 2024, CMS will allow ACOs currently participating in Level A or B the option to continue in their current level for the remainder of their agreement.

CMS said it made the changes in response to concerns that smaller health care providers in rural and underserved settings need additional time to transition to two-sided risk, and that quickly requiring ACOs to adopt two-sided risk models was a barrier to participation in the MSSP.

Other changes aim to strengthen program participation

CMS will also:

  • Retool the ACO benchmarking system to encourage long-term participation in the program
  • Make changes to the ACO risk adjustment methodology to better account for medically complex, high-cost beneficiaries
  • Expand eligibility for low-revenue ACOs to share in savings even if they don’t meet the minimum savings rate requirement
  • Implement a health equity adjustment to reward ACOs that provide excellent care for underserved populations