Healthcare Economist January 19, 2022
An interesting article in Modern Healthcare reviews some discussion at a recent Medicare Payment Advisory Commission (MedPAC) meeting. The first issue is that the pool of fee-for-service Medicare beneficiaries is shrinking, at least on a relative basis.
As Medicare Advantage grows each year, population-based alternative payment models like accountable care organizations are left with a shrinking pool of beneficiaries, he added.
Another issue is that generating “savings” year after year may be increasingly difficult over time.
Because ACO benchmarks are reset each performance period based on the ACO’s past performance, an ACO that improves the amount of savings it generates each year will have to deal with benchmarks that are increasingly harder to exceed, which puts...
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