ACOs leaders say downside risk is hurting Shared Savings Program

The number of participating ACOs dropped this year as tougher downside-risk rules went into effect
Peter Wehrwein

Leaders of the National Association of ACOs see danger signs in the latest data for the Shared Savings Program as new rules that will make participants take on downside risk sooner go into effect.

Thee NAACOS numbers show that overall participation in the program fell for the first time since 2012. In 2018, 561 ACOs participated in the Shared Savings Program, CMS's main ACO program. In 2019, that number dipped to 518.  Just 41 new ACOs signed up in 2019, by the NAACOS  count; the previous low for new participants was 89 in 2015. And about 40% of the 203 ACOs whose contracts expired at the end of last year dropped out of the program compared with the usual "churn rate" of 30%.

These were some of the gloomy numbers that David Pittman, Allison Brennan, and Clifton Gaus wrote about in a Health Affairs blog post today.

The "Pathways to Success" rules for the Shared Savings Program went into effect in July. They contain a whole raft of changes, some favored by NAACOS, but the major one reduces the amount of time a Shared Savings Program ACO can enjoy upside-only risk from six years to two. CMS Administrator Seema Verma has said ACOs need to assume two-sided risk sooner if they are to ever achieve serious cost savings.