Participants Earned $484 Million Under GPDC Model, CMS Saved $371 Million
Today’s blog is by CLA’s Rebecca Rye
On October 20, CMS released performance year (PY) 2022 participant-level financial and quality results for the now-concluded Global & Professional Direct Contracting (GPDC) model. As you may remember, GPDC then transitioned into ACO REACH.
The GPDC model began with PY2021, with the goals of improving beneficiary access to providers who are actively engaged in their care, incentivizing improvements in quality of care by shifting payments from fee-for-service (FFS) to value-based/capitated payments, and by allowing a broader range of organizations to participate in a value-based payment model. In particular with the latter, the GPDC model included a high-needs option for organizations serving complex beneficiaries.
In response to a strategy refresh release in 2021, CMS decided to reorganize the GPDC model and release the ACO Realizing Equity, Access, and Community Health (ACO REACH) model beginning with PY2023. The new model includes a greater emphasis on health equity, a reduced quality withhold from 5% to 2%, and implements additional monitoring and compliance efforts. For a more detailed look at the changes made between the GPDC and ACO REACH models, check out CLA’s blog on the ACO REACH model.
GPDC Results
Some of the most significant GPDC result highlights include:
- The average quality score for all direct contracting entities (DCEs) was at or above 99%. Only 11 total ACOs had quality scores under 100%.
- The net savings to CMS was $371.5 million and the net savings to DCEs was $484.1 million. These savings represent an increase from the $70.4 million in net CMS and $46.5 million net DCE savings in PY 2021.
- 93% of the PY2022 CMS net savings was due to the 2% discount applied to Global risk option benchmarks.
- Of all DCEs, 72 were in the Global risk option while 27 elected the Professional. There were 13 new entrant DCEs and 8 high needs DCEs. The rest were Standard.
- High Needs Population and New Entrant DCEs achieved a higher performance compared to Standard DCEs, including a New Entrant that saved the highest amount of all DCEs.
- Overall, 77% of the 99 entities earned a net savings while 23% had a net savings loss.
Updates to ACO REACH
In addition to GPDC results, CMS has released a set of updates to the ACO REACH model for future years, including:
- Reducing the beneficiary requirement minimums for New Entrant and High Needs Population ACOs beginning in PY2025. New Entrant minimums will decrease from 5,000 to 4,000 in PY2025, while maintaining the 5,000-beneficiary requirement for PY2026. High Needs Population ACO minimums will decrease from 1,200 to 1,000 in PY2024 and from 1,400 to 1,250 in PY2026.
- Implementing a one-time 10% alignment buffer in PY2024 to allow an ACO to continue to participate in the model even if beneficiary alignment temporarily dips below the alignment minimum by up to 10%.
- Expanding the eligibility requirements for potential High Needs Population ACO aligned beneficiaries. Criteria will now include beneficiaries that have at least 90 days of Medicare-covered home Health services utilized, or at least 45 Medicare-covered days in a Skilled Nursing Facility with in the last 12 months.
- Modifying the Provisional Settlement to include 12 months of performance year experience with no run-out, rather than the previous 6 months of experience with a 6 month run out, to allow early savings/loss payments used for Provisional Settlement to estimate the Final Settlement more accurately.
- Applying the revised 2024 Part C Medicare Advantage risk adjustment model to Standard and New Entrant ACOs.
- Revising the composite measure used for the Health Equity Benchmark Adjustment (HEBA) by incorporating new variables: Low-Income Subsidy Status and State-based Area Deprivation Index. Each factor will be weighted equally when calculating the HEBA score.
- In an effort to increase the impact of the HEBA, adjusting the distribution of HEBA adjustment amounts to $30 PBPM for beneficiaries with equity scores in the top decile, $20 PBPM for the second decile, $10 PBPM for the third decile, $0 for the next four deciles, and $-10 for the bottom three deciles.
These measures will be implemented starting in PY2024, and are expected to improve the model by increasing predictability, creating consistency across Center for Medicare and Medicaid Innovation models, protecting against extreme risk score growth, and advancing health equity.
How CLA can help
Interested in exploring alternative payment models, or wondering how updates to ACO REACH may impact your organization? CLA is here to help—reach out today.
Jennifer Boese is the Director of Health Care Policy at CLA. She is a highly successful public policy, legislative, advocacy and political affairs leader, including working in both the state and federal government as well as the private sector. She brings over 20 years of government relations and public policy knowledge with her to CLA. Well over half of her career has been spent dedicated to health care policy and the health care industry, affording her a deep understanding of the health care market and environment, health care organizations and health care stakeholders. Her role at CLA is to provide thought leadership, policy analysis and strategic insights to health care providers across the continuum related to the industry's ongoing transformation towards value. A key focus of that work is on market innovations and emerging payment models. Her goal is to help CLA clients navigate and thrive in an increasingly dynamic health care environment.
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