Quality Series: ACOs 

Timothy P. McNeill, RN, MPH 

Healthcare Consultant 
Agenda 

1. MACRA’s impact on ACOs

2. ACO Quality Measures 

3. Points of Pain for MCOs 

4. Next Steps 
Robust Changes to the Healthcare Landscape 

• The Patient Protection and Affordable Care Act 

– Commonly called the Affordable Care Act or ACA 

– Signed into law by President Obama on March 23, 2010 

– On June 28, 2012, the Supreme Court upheld the law 

• MACRA – Medicare Access and CHIP 

Reauthorization Act 

– Increased emphasis on physician participation in Alternative 

Payment Models (APMs) 

– APMs – Accountable Care Organizations (ACOs), Bundled 

Payment 
Push for greater adoption of APMs 

4 

• January 26, 2015 – HHS Secretary Sylvia M. Burwell 

announced measureable goals and a timeline to move 

the Medicare program towards paying for Quality 

rather than Quantity 

– Goals 

• 30% of all fee-for-service Medicare payments will be 

through an APM 

• 50% of all payments will be through these models by 

2018 

• http://www.hhs.gov/news/press/2015pres/01/20150126a.

html
MACRA Early Impact 

5 

• “Doc Fix” bill. Repeals SGR Methodology

• Sunsets current physician payment adjustments 

– PQRS (Physician Quality Reporting System) 

– Value-Based Payment Modifier (Begins 2015) 

– Electronic Health Record (EHR) Incentive Program 

– Maximum potential penalties grows to 8% by 2018 

– 2019 – Merit-Based Incentive Payment System (MIPS) 

replaces these models 
MACRA Early Impact (Cont.) 

6 

• Eligible Providers (EPs) will be subject to an initial 

4% payment adjustment 

• 2019, which grows to 9% in 2022 and later 

– Merit-based Incentive Payment System (MIPS) 

– EPs that meet the APM threshold are exempt and receive a 

lump sum incentive payment instead of being subject to a 

potential MIPS penalty 
MACRA Financial Incentives 

7 

• Eligible Providers that meet the required threshold for 

APM participation 

– Receive a 5% lump sum incentive payment based on the 

estimated aggregate of Part B covered professional services 

for the preceding year 

– 2019 – 2020: EPs must have 25% of their payments through 

APMs 

– 2021 – 2022: EPs must have 50% of their payments through 

APMs 
APM - Accountable Care Organizations 

8 

• “Accountable Care Organizations (ACOs) are groups 

of doctors, hospitals, and other health care providers 

who come together voluntarily to give coordinated 

care to Medicare Beneficiaries.”

– CMS 
ACO Goals 

9 

• Provide coordinated care to an attributed set of 

Medicare Fee-for-Service beneficiaries which results 

in improved health outcomes and reduced health care 

expenditures 
ACO Incentive 

10

• When an ACO succeeds in improving health outcomes 

and reducing costs, it will share in the savings. 

• Prior to ACOs there was not a mechanism for CMS to 

share savings with providers that have improved 

outcomes and lower costs. 

– System maintained a reverse financial incentive 
ACO Programs 

11

• Medicare Shared Savings Program (MSSP) 

– Most Common 

– Hundreds of Participants 

• Pioneer ACO Model 

– 19 remaining participants 

• Next Generation ACO Model 

– Awards are expected by January 1, 2016 

– Full-Risk Model 
Attribution Process 

12

• MSSP ACO applications accepted each July 

• New MSSP ACOs begin January of the following 

Year 

– July 2015 applicants will begin January 1, 2016 

• All providers in the ACO submit their Tax ID Number

(TIN) 

• 3-year look back of all beneficiaries served by the 

PCPs in the ACO 

• Consumers are attributed to the provider that provided 

the majority of paid primary care services 
Hospital and Specialist role in an ACO 

13

• Consumers are attributed based on preponderance of 

primary care claims paid to a participating ACO 

primary care provider 

– Primary care providers can only participate in 1 ACO 

• Specialists do not attribute beneficiaries, unless the 

beneficiary had NO primary care claims 

• Hospitals do not attribute beneficiaries 

– Specialists and hospitals can participate in more than one

ACO
Share of Savings 

14

• MSSP ACOs can earn up to 60% of the savings they 

create, depending on how they perform on 33 quality

measures 

– Initially, MSSP ACOs are not required to take risk 

– Risk will be required after a 5 year participation period 

• Pioneer ACOs can earn up to 75% of the savings the

create 

– All Pioneer ACOs must take risk for losses at this time 

y 
What Makes Up the Cost Analysis?

15

• Included Costs 

– Medicare Part A Expenditures 

– Medicare Part B Expenditures 

• Excluded Costs 

– Medicare Part D 

– Medicaid Costs 

– Medicaid LTSS 

– Medicaid HCBS
Medicare Part A Benefits 

16

• Medicare Part A covers the following services: 

– Inpatient Hospital Care 

– Skilled Nursing Care 

– Home Health Care 

– Hospice Care 
Medicare Part B Benefits 

17

• Medicare Part B covers the following services: 

– Medically Necessary Outpatient Services 

– Preventive Health Services 

– Doctor Visits 

– Ambulance Services 

– Supplies 

– Durable Medical Equipment (Wheelchairs, Walkers, Etc.) 
Medicaid 

• The Medicaid program is jointly funded by the 

federal government and states. The federal 

government pays states for a specified percentage of 

program expenditures, called the Federal Medical 

Assistance Percentage (FMAP) 

• For dual eligibles 

– Medicare: Primary 

– Medicaid: Secondary 
Duals 

19

• 20% of Medicare beneficiaries are dual eligibles 

• Duals have a significantly higher per capita expen

than non-duals 

– MedPac, June 2013, Pg. 153: Per capita spending on d

eligible beneficiaries in FFS was $15,743 compared to 

$8,081 for non-duals 

• ACOs receive a separate report showing the 

percentage of duals they have compared to other 

ACOs and the requisite costs 

• Medicare is the primary payer for duals 

se 

ual-
Duals and Shared Savings 

20

• Population is high risk due to the their overall higher 

costs 

• Potential increases in utilization and costs, for duals in 

an ACO, directly impacts the success or failure of an 

ACO 

• Many ACOs develop a specific strategy just to address

the Duals because of the high costs attributed to them 

• Medicaid HCBS has been shown to reduce Medicare 

costs by reducing institutionalization 
Shared Savings and Quality 

21

• Each year, ACOs must submit quality data to CMS 

– ACO quality measure reporting period is generally between

January & March 

• There are 33 quality measures that are analyzed 

• If an ACO does not meet the minimum quality 

measure threshold, they are not eligible or their share 

of savings. 
4 Quality Measure Domains

22

• Patient/Caregiver Experience 

• Care Coordination/Patient Safety 

• Preventive Health 

• At-Risk Population Health Management 

– Diabetes Mellitus 

– Hypertension 

– Ischemic Vascular Disease 

– Coronary Artery Disease 
ACO Quality Measures 

23

Domain Measure Title 

Patient/Caregiver Experience Getting Timely Care, appointments and 

information 

Patient/Caregiver Experience How well your doctors communicate 

Patient/Caregiver Experience Patient’s rating of doctor 

Patient/Caregiver Experience Access to specialists 

Patient/Caregiver Experience Health promotion and education 

Patient/Caregiver Experience Shared decision making 

Patient/Caregiver Experience Health Status/Functional Status 
ACO Quality Measures (Cont.) 

24

Domain Measure Title 

Care Coordination/Patient Safety All Cause Readmissions 

Care Coordination/Patient Safety Ambulatory Sensitive Admissions: 

COPD, Asthma 

Care Coordination/Patient Safety Ambulatory Sensitive Admissions: 

Congestive Heart Failure 

Care Coordination/Patient Safety Percent of PCPs that meet meaningful 

use standards 

Care Coordination/Patient Safety Medication reconciliation after 

discharge from an inpatient facility 

Care Coordination/Patient Safety Screening for Fall Risk 
ACO Quality Measures (Cont.) 

25

Domain Measure Title 

Preventive Health Influenza Immunization 

Preventive Health Penumococcal Vaccination 

Preventive Health Adult Weight Screening and Follow-up

Preventive Health Tobacco Use Assessment and 

Intervention 

Preventive Health Depression Screening 

Preventive Health Colorectal Cancer Screening 

Preventive Health Mammography Screening 

Preventive Health Screening for High Blood Pressure 
ACO Quality Measures (Cont.) 

26

Domain Measure Title 

At Risk Population – Diabetes Diabetes composite Hemoglobin A1C 

Control ( < 8%) 

At Risk Population – Diabetes Composite: LDL ( < 100) 

At Risk Population – Diabetes Composite: Tobacco Non Use 

At Risk Population – Diabetes Composite: Aspirin Use 

At Risk Population – Diabetes Diabetes Mellitus: Hemoglobin A1c 

Poor Control ( > 9 %) 
ACO Quality Measures (Cont.) 

27

Domain Measure Title 

At-Risk Population – Hypertension Hypertension Control 

At-Risk Population – Ischemic Vascular 

Disease 

Ischemic Vascular Disease (IVD): 

Complete Lipid Panel and LDL Control 

(< 100 mg/dl) 

At Risk Population - Coronary Artery 

Disease 

Drug therapy for lowering LDLCholesterol 

At Risk Population – Heart Disease Heart Failure: Beta Blocker Therapy 

for left ventricular systolic dysfunction 

At Risk Population – Coronary Artery 

Disease 

ACE Inhibitor therapy 
Quality Benchmarks

28

Domain Weight 

Patient/Caregiver Experience 25%

Care Coordination/Patient Safety 25%

Preventive Health 25%

At-Risk Population 25%

Total 100%
Sliding Scale Measure Scoring Approach 

29

• Points are earned based on a comparison of the 

individual ACO scores compared with the 

performance of all ACOs 

• Total points earned in each domain are summed and 

divided by total points available 

• Total points in each domain are averaged together to 

obtain a final overall quality score 
Score Analysis 

30

• For most measures, the higher the level of 

performance, the higher the number of points 

– Lower score is better for the following measures 

• Risk Standardized, All condition readmissions 

• Ambulatory sensitive conditions admissions: COPD, 

Asthma 

• Ambulatory sensitive conditions admissions: CHF

• Diabetes: Hgb A1c poor control 
Sliding Scale Measure Scoring Approach 

31

ACO Performance Level Quality Points 

90+ Percentile 2.00 Points 

80+ Percentile 1.85 Points 

70+ Percentile 1.70 Points 

60+ Percentile 1.55 Points 

50+ Percentile 1.40 Points 

40+ Percentile 1.25 Points 

30+ Percentile 1.10 Points 

< 30 Percentile No Points 
2014 Mean Performance Rate for All ACOs 

32

• Falls: Screening for fall risk: 46.71% 

• Influenza Immunization: 58.27% 

• Pneumococcal Vaccination: 56.31% 

• Depression Screening: 40.46% 

• Adult Weight screening and Follow-Up 66.82% 

• Health Promotion and Education 58.40% 

• All Condition Readmissions (Lower is better) 15.16% 

• Medication Reconciliation 82.66% 
Sliding Scale Measure Scoring Approach 

33

ACO Performance Level Quality Points 

90+ Percentile 2.00 Points 

80+ Percentile 1.85 Points 

70+ Percentile 1.70 Points 

60+ Percentile 1.55 Points 

50+ Percentile 1.40 Points 

40+ Percentile 1.25 Points 

30+ Percentile 1.10 Points 

< 30 Percentile No Points 
2014 Mean Performance Rate for All ACOs (Cont.)

34

• Diabetes Composite (ACO 22-26) 26.07% 

– Hemoglobin A1c Control < 8% 

– LDL < 100 mg/dL

– Blood Pressure < 140/90 

– Tobacco Non-Use 

– Aspirin Use 

• Hemoglobin A1c Poor Control > 9% 19.99% 

– (Lower is better) 

• Proportion of Adults who had blood 60.00% 

• pressure screened in Past 2 years 

• CAD Composite 75.34% 

– Drug Therapy for Lowering LDL 

– Cholesterol 

– ACE Inhibitor or ARB Therapy for 

– Patients with CAD and Diabetes and/or 

– LVSD 
Sliding Scale Measure Scoring Approach 

35

ACO Performance Level Quality Points 

90+ Percentile 2.00 Points 

80+ Percentile 1.85 Points 

70+ Percentile 1.70 Points 

60+ Percentile 1.55 Points 

50+ Percentile 1.40 Points 

40+ Percentile 1.25 Points 

30+ Percentile 1.10 Points 

< 30 Percentile No Points 
Alternative Payment Models: Points of Pain 

36

• MedPac Report to Congress. June 2013. Pg 106

– “There is concern that hospitals serving large shares of poor

patients tend to have higher readmission rates and that 

hospitals serving these patients will be more likely to pay 

readmission penalties.”

• MedPac Report to Congress. June 2013. Pg 107

– “We found that hospitals with high shares of poor patients 

(as indicated by their share of Medicare patients on SSI) 

tended to have higher readmission rates and thus higher 

penalties.”
Result of MedPac Report on Socioeconomic 

Status 

37

• Senate Bill S. 2501 

• Sponsor: Sen. Joe Manchin, III (D-WV) 

• Read twice and referred to the Committee on Finance 

• Provides a mandate for CMS to develop a special risk 

adjustment to account for patient socioeconomic status 
Separate House Bill Addressing 

Socioeconomic Status 

38

• H.R. 1343 

• Establishing Beneficiary Equity in the Hospital Readmission 

Program Act of 2015 

• Bill referred to the House Committee on Ways and Means 

• Requires the HHS Secretary to make a risk adjustment based o

the proportion of in-patients who are full-benefit dual eligibles 

• Requires the HHS Secretary to take in account the 

socioeconomic status of the population of patients served by a 

particular hospital in calculating readmissions 

n 
CMS Study of Socioeconomic Factors on Star 

Ratings 

39

• Released September 8, 2015 

• Beneficiaries with low socioeconomic status assessed 

based on Low-Income Subsidy (LIS) receipt and/or 

Dual Eligible (DE) status 

• Study found that 12 out of the 16 Star measures have a 

statistically significant negative association with 

LIS/DE status 

– All Cause Readmissions 

– Medication Adherence 

– Diabetes/Heart Disease Measures 
Seize the Opportunity

40

• Stratify the population 

• Identify the need of the consumer that matches your 

strengths 

• Population that unanimously has been cited as a point

of pain 

– Consumers with low socioeconomic status 

– Duals 

– Consumers eligible for Medicaid HCBS that are at 

risk for institutionalization 

 
What do beneficiaries need? 

• Services that meet medical necessity to support them in 

meeting their health-care and community living goals in 

the least restrictive environment possible. 
What does the customer/contracting organization 

need?

• Data 

• Data 

• More data 

• Integrated Care Organizations have performance goals 

to meet 

– Financial and quality risks 

• How do you contribute to improving quality and 

reducing financial risk? 

– If you are not, why should they contract with you? 
Next Steps 

• Know your market 

• Know your competition 

• Study your customer 

• Organize and execute 
Questions 

• tmcneill@me.com 

Timothy P. McNeill, RN, MPH 

Consultant 

Direct: (202) 344-5465 

44