The Centers for Medicare & Medicaid Services and Department of Health and Human Services have pursued shared-risk initiatives to move providers toward greater accountability for Medicare fee-for-service beneficiaries. This is despite providers’ vocal objections to shared-risk arrangements. Two voluntary shared-risk initiatives launching soon are Pathways to Success and Primary Cares.

These initiatives appear somewhat similar in a side-by-side comparison. Perhaps unintentionally, CMS has created scenarios in which the initiatives will likely compete for participants. The chart below details how the two initiatives compare with one another on program structures:

Pathways to Success Primary Cares
Goal Overhaul the Medicare Shared Savings Program to accelerate when providers bear risk Enhance primary care and reduce unnecessary hospitalizations and specialty care
Program Tracks Basic

Enhanced

Primary Cares First (PCF)

Direct Contracting (DC)

Participants IDNs

Hospitals

Physician Organizations

PCF: risk-ready primary-care practices

DC: risk-savvy IDNs and physician organizations

Risk Timeline Basic: Year 3 for most ACOs

Enhanced: Immediately

PCF: Immediately

DC: Immediately

Shared-Risk Basic: 30%

Enhanced: 75%

PCF: 10%

DC: 50% or 100%

Potential Shared-Savings Basic: 40% or 50%

Enhanced: 75%

PCF: 50%

DC: 50% or 100%

 

Though Primary Cares was just announced, it has the potential to attract providers from the Medicare Shared Savings Program (MSSP), which has been threatened with loss of participation because of Pathways to Success.

Primary-care practices may look at Primary Cares as an appealing alternative to the revamped MSSP. Though most MSSP participants have about two years before bearing risk under the Basic Track in the third year, the lower shared-risk rate under Primary Care First may prove to be a better option for those new to risk. The potential shared-savings rate is the same for both initiatives.

Furthermore, some primary-care practices that participate in a MSSP ACO join a provider consortium formed by a managing organization. Though these practices are still independent, the ACO’s results are dependent on all cohorts’ performance. Individual practices cannot fully control whether they receive a shared-savings payment through the MSSP. But practices that choose to participate in Primary Cares will have greater autonomy and will be responsible only for their own performance, which may be an attractive option for high-performing primary-care groups.

Larger provider organizations and integrated delivery networks will have the option to choose between participating in the Direct Contracting track of Primary Cares and a Medicare ACO. CMS has established that providers cannot participate in more than one shared-savings initiative, which includes Medicare ACOs and the Direct Contracting track. IDNs and large groups may look at the lower-risk track of Direct Contracting as an option to bear risk but avoid the potential for larger losses seen in the higher-risk, higher-reward Enhanced track.

Moving forward, it will be important to understand the unique dynamics of each of these Medicare initiatives, including a program’s quality measures. It will also be important to understand the reasoning behind a provider organization’s decision to join an initiative. From there, targeting strategies can be formed and tailored to the specific provider organization.

Sarah Wilson is a principal analyst at DRG with expertise in ACOs and alternative payment models. Follow Sarah on Twitter @SarahWilsonDRG.

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