Source: https://www.law.cornell.edu/cfr/text/42/425.606
Timestamp: 2019-02-15 21:10:18
Document Index: 459600276

Matched Legal Cases: ['§ 425', '§ 425', '§ 425', '§ 425', '§ 425', '§ 425', '§ 425']

42 CFR § 425.606 - Calculation of shared savings and losses under Track 2. | CFR | US Law | LII / Legal Information Institute
Section 425.606. Calculation of shared savings and losses under Track 2.
42 CFR § 425.606 - Calculation of shared savings and losses under Track 2.
Link to an amendment published at 83 FR 60094, November 23, 2018.
(a)General rule. For each performance year, CMS determines whether the estimated average per capita Medicare expenditures under the ACO for Medicare fee-for-service beneficiaries for Parts A and B services are above or below the updated benchmark determined under § 425.602. In order to qualify for a shared savings payment under Track 2, or to be responsible for sharing losses with CMS, an ACO's average per capita Medicare expenditures under the ACO for Medicare fee-for-service beneficiaries for Parts A and B services for the performance year must be below or above the updated benchmark, respectively, by at least the minimum savings or loss rate under paragraph (b) of this section.
(1)Newly assigned beneficiaries.CMS uses an ACO's HCC prospective risk score to adjust the benchmark for changes in severity and case mix in this population.
(i)CMS uses demographic factors to adjust the benchmark for changes in the continuously assigned beneficiary population.
(ii) If the prospective HCC risk score is lower in the performance year for this population, CMS will adjust the benchmark for changes in severity and case mix for this population using this lower prospective HCC risk score.
(3) Assigned beneficiary changes in demographics and health status are used to adjust benchmark expenditures as described in § 425.602(a). In adjusting the benchmark for health status and demographic changes CMS makes separate adjustments for each of the following populations of beneficiaries:
(i)ESRD.
(5)CMS uses a 3 month claims run out with a completion factor to calculate an ACO's per capita expenditures for each performance year.
(A) For performance years beginning before 2018, these calculations will take into consideration all individually beneficiary identifiable payments, including interim payments, made under a demonstration, pilot or time limited program.
(B) For performance year 2018 and subsequent performance years, these calculations will take into consideration individually beneficiary identifiable final payments made under a demonstration, pilot or time limited program.
(b)Minimum savings or loss rate. (1)(i) For agreement periods beginning in 2012 through 2015, the ACO's MSR and MLR are set at 2 percent.
(ii) For agreement periods beginning in 2016 and subsequent years, as part of the ACO's application for, or renewal of, program participation, the ACO must choose from the following options for establishing the MSR/MLR for the duration of the agreement period:
(B) Symmetrical MSR/MLR in a 0.5 percent increment between 0.5-2.0 percent.
(2) To qualify for shared savings under Track 2, an ACO's average per capita Medicare expenditures for the performance year must be below its updated benchmark costs for the year by at least the MSR established for the ACO.
(3) To be responsible for sharing losses with the Medicare program, an ACO's average per capita Medicare expenditures for the performance year must be above its updated benchmark costs for the year by at least the MLR established for the ACO.
(c)Qualification for shared savings payment. To qualify for shared savings, an ACO must meet the minimum savings rate requirement established under paragraph (b) of this section, meet the minimum quality performance standards established under § 425.502 of this part, and otherwise maintain its eligibility to participate in the Shared Savings Program under this part.
(d)Final sharing rate. An ACO that meets all the requirements for receiving shared savings payments under Track 2 will receive a shared savings payment of up to 60 percent of all the savings under the updated benchmark, as determined on the basis of its quality performance under § 425.502 of this part (up to the performance payment limit described in paragraph (e)(2) of this section).
(f)Shared loss rate. The shared loss rate -
(g)Loss recoupment limit. The amount of shared losses for which an eligible ACO is liable may not exceed the following percentages of its updated benchmark as determined under § 425.602:
(h)Notification of savings and losses.
(1)CMS notifies an ACO in writing regarding whether the ACO qualifies for a shared savings payment, and if so, the amount of the payment due.
(2)CMS provides written notification to an ACO of the amount of shared losses, if any, that it must repay to the program.
(i)Extreme and uncontrollable circumstances. For performance year 2017, the following adjustment is made in calculating the amount of shared losses, after the application of the shared loss rate in paragraph (f) of this section and the loss recoupment limit in paragraph (g) of this section.
(1)CMS determines the percentage of the ACO's performance year 2017 assigned beneficiary population affected by an extreme and uncontrollable circumstance.
(2)CMS reduces the amount of the ACO's shared losses by an amount determined by multiplying the shared losses by the percentage of the total months in the performance year affected by an extreme and uncontrollable circumstance, and the percentage of the ACO's assigned beneficiaries who reside in an area affected by an extreme and uncontrollable circumstance.
(3)CMS applies determinations made under the Quality Payment Program with respect to -
(4)CMS has sole discretion to determine the time period during which an extreme and uncontrollable circumstance occurred and the percentage of the ACO's assigned beneficiaries residing in the affected areas.
[76 FR 67973, Nov. 2, 2011, as amended at 80 FR 32842, June 9, 2015; 81 FR 38017, June 10, 2016; 82 FR 53370, Nov. 15, 2017; 82 FR 60918, Dec. 26, 2017]