Whether you’re an experienced ACO or a newbie, HHS has a shared-savings plan for you. Rules released by HHS propose two separate financial models that allow participating ACOs to share in savings relative to Medical expenditure targets for a risk-adjusted population of patients.
The “two-sided model” is a three-year contract designed for organizations with experience managing financial risk. Under this model, ACOs would receive 60% of shared savings – assuming the ACO also meets certain quality requirements. However, ACOs would be at risk for a portion of expenditures that exceeds targets (5% in year one, 7.5% in year two and 10% in year three).
The “one-sided model” is a three-year contract designed to be “an entry point for organizations with less experience managing care and accepting financial risk.” These might include physician organizations and small ACOs that need to “gain experience with population management.” ACOs would receive 50% of shared savings in the first two years of the contract with no downside risk. In the third year, the contact would automatically switch to a two-sided model with both upside and downside risk. Shared savings are net of a 2% threshold.