1. Next Generation ACO Models: Legal and Operational Design Strategies
Friday, May 27, 2016, H20 Session (11:15-12:15 pm)
Thomas N. Shorter, JD, FACHE
Godfrey & Kahn, S.C.
Madison, WI

2. Outline The CMS Next Gen ACO Model I. Core Principles II. Scope
III. Legal Components
IV. Operational Design Elements

3. I. Core Principles
Protect Original Medicare beneficiaries’ freedom of choice
Engage beneficiaries in their care through benefit enhancements
Create long-term financial sustainability

4. I. Core Principles (cont’d)
Utilize prospectively-set benchmarks
Reward quality;
Reward improvement and attainment of efficiency; and
Transition away from an ACO’s recent expenditures when setting and updating the benchmark.

5. I. Core Principles (cont’d)
Mitigate fluctuations in aligned beneficiary populations
Smooth cash flow by seeking alternative payment mechanisms
Incentivize greater coordination of care

6. Comprehensive ESRD Care
II. Scope
Two-sided risk model
Next Gen
21 participants: 7 from MSSP and 8 from the Pioneer Model
2 WI - based participants: Bellin Health DBA/Physician Partners and ThedaCare ACO
Comprehensive ESRD Care
Oncology Care Model

7. III. Legal Components Legal Entity requirements
Governing Body structure, responsibilities, composition and control requirements
Leadership and Management requirements

8. IV. Operational Design Elements
Benchmark
B. Risk Arrangements
Increased Shared Risk
80% sharing rate (PY1-3)
85% sharing rate (PY4-5)
15% savings/losses cap
Discount
Full Performance Risk (100% Risk)

9. IV. Operational Design Elements
Payment Mechanisms
1. Normal FFS Payment
2. Infrastructure Payments
3. Population Based Payments
4. Capitation Conceptual

10. Infrastructure Payments Conceptual Diagram
All Other Medicare Providers
CMS
Next Generation Affiliates
Next Generation Preferred Providers
Next Generation Providers/Suppliers
ACO
Claim
Claim Payment
Per-beneficiary per- month

11. IV. Operational Design Elements
D. Beneficiary Eligibility and Alignment
Benefit Enhancement
F. Quality and Performance
G. Monitoring and Oversight

12. V. Conclusion: Future Development
A. Evaluation
B. Application Scoring & Selection
C. Duration of Agreement(s)
1. Three performance periods for 2016
2. Two performance periods for 2017

13. Thank You
Thomas N. Shorter, JD, FACHE Godfrey & Kahn, S.C. One East Main Street, Suite 500 Madison WI (608)