Rural-based Accountable Care Organizations Accepting Downside Risk

Research center:
Lead researcher:
Project funded:
September 2022
Anticipated completion date:
August 2023

The Shared Savings Program (SSP) changed significantly with the advent of "Pathways to Success" in July 2019, which limits the number of years accountable care organizations (ACOs) are allowed to participate as levels A and B, the one-sided risk model, up to three years (a function of volume of Medicare revenue). This new reality began affecting continued participation in SSP in late 2019, but has been most notable in subsequent years, particularly 2021 and 2022. A critical question is: are decisions to not renew SSP agreements after three years more common among rural-based ACOs?

We will first present data on exits and entries into the SSP for years 2016 – 2022. This time period overlaps by two years previous RUPRI Center studies and provides three years (2016 – 2018) prior to implementing Pathways to Success, enabling us to see trends affected by the new rule. We expect the trends to show increasing effects 2019 – 2022 as more SSPs reach the end of eligibility for Levels A and B. We will show the trends for these characterizations of ACOs (used in our previous publications) of counties in which ACO participating providers are present: 100% nonmetro, 70% - 99% nonmetro, 30% - 69% nonmetro; 1% - 29% nonmetro, and 0% nonmetro. The next step will be to test statistical models that explain differences between organizations that exit and those that either remain in the program or enter the program. Independent variables in the model will include: number of enrolled lives, ACO governance (hospital, physician, hybrid), financial indicators (including receiving shared savings), quality indicators, affiliation with supporting organization, and prior experience in the program.

This study will provide important information to the Federal Office of Rural Health Policy to share with Centers for Medicare & Medicaid Services and others in the Department of Health and Human Services responsible for meeting the goal of all Medicare beneficiaries being in an "accountable entity" by 2030. It will inform updated SSP rules and legislative action that may address ongoing challenges for rural providers interested in forming and sustaining ACOs, including implementing the final rule in 2023 that is likely to create new time lines for low-revenue ACOs to convert from one-sided to two-sided risk.