3 Next Generation ACOs drop out with two citing financial targets as reason
The departures leave 18 providers in the risk-based ACO program that began the year with 21 participants.
WakeMed Key Community Care in North Carolina, which includes the Raleigh hospital campus, has dropped out of the NextGen ACO program.
Two participating providers in Next Generation have dropped out citing difficult financial targets and a third is partially participating, according to the Centers for Medicare and Medicaid Services and the providers.
The departures leave 18 providers in the risk-based ACO program that began the year with 21 participants, according to data released July 15 by the CMS.
Three weeks after CMS announced Next Gen participants in January, RiverHealth of Pennsylvania dropped out, saying it was unable to meet CMS's financial targets.
Also giving notice: Heritage California which includes Regal Medical Group and other medical groups, and WakeMed Key Community Care in North Carolina, according to CMS.
"Heritage Provider Network is partially participating in the Next Gen ACO program for calendar year 2016, and will be fully participating in calendar year 2017," according to a statement from the provider.
[Also: Next Generation's 21 accountable care organizations take on added risk]
Heritage California ACO participated the previous CMS risk-based model, Pioneer, from 2012-2015, according to the health system. It had contracted close to 1,000 participating providers and 5,000 preferred providers for Next Gen ACO, it said.
Next Generation had built upon the Pioneer ACO model, offering higher levels of financial risk and rewards.
RiverHealth ACO, a partnership of PinnacleHealth System, Susquehanna Health and affiliates, formed in 2012 under the Medicare Shared Savings Program.
"While RiverHealth ACO managed the rate of increase in costs to below the national average, projections do not indicate that the ACO would be able to meet the current target set by CMS," RiverHealth said in a statement released in February.
WakeMed Key Community Care also cited the difficult financial metrics. The ACO is a joint venture between WakeMed Health and Hospitals and Key IPA.
WakeMed Key Community Care's Board of Managers made a business decision to withdraw from the Next Generation ACO program for 2016 after evaluating financial and operational metrics, according to the provider.
"Though we were committed to the program, developments in Q1 led the board to reconsider the Next Generation participation decision," WakeMed Key Community Care said by statement.
One factor was the higher than expected trend in 2015. As the ACO had a very low benchmark, it was more susceptible to variability, the provider said. Secondly, the board was unable to secure reinsurance to provide downside protection for the 2016 performance year.
"We are currently evaluating options for Medicare ACO participation in 2017," WakeMed Key Community Care said.
[Also: Dartmouth-Hitchcock defers joining Next Generation due to financial targets]
In January, the Centers for Medicare and Medicaid Services announced that 21 health systems were participating in the ACO model, with many of those jumping over from the former Pioneer program.
CMS is expected to announce next year's participants in August.
Providers remaining in the program as of July 15 include: Beacon Health in Maine; Triad Healthcare network in North Carolina; Henry Ford Physician ACO in Michigan; MemorialCare Regional ACO in California; OSF Healthcare System in Illinois; Optum ACO in Arizona; Park Nicollet Health Services in Minnesota; Deaconess Care Integration in Indiana; Iowa Health Accountable Care in Iowa; Cornerstone Health Enablement Strategic Solutions in North Carolina; Pioneer Valley Accountable Care in Massachusetts; Baroma Accountable Care in Florida; Accountable Care Coalition of Southwest Texas; ThedaCare ACO of Wisconsin; Steward Integrated Care Network in Massachusetts; Trinity Health in Michigan; Prospect ACO in California; and Bellin Health DBA Physician Partners in Wisconsin.
In January, the Next Generation health systems included: Accountable Care Coalition of Southeast Texas Inc.; Baroma Accountable Care; Beacon Health; Bellin Health DBA Physician Partners; Cornerstone Health Enablement Strategic Solutions; Deaconess Care Integration; Iowa Health Accountable Care; MemorialCare Regional ACO; Optum Accountable Care Organization; OSF Healthcare System; Park Nicollet Health Services; Pioneer Valley Accountable Care; Prospect ACO; Regal Medical Group; River Health ACO; Steward Integrated Care Network; ThedaCare ACO LLC; Triad HealthCare Network; Trinity Health ACO; WakeMed Key Community Care; and Henry Ford Physician ACO.
Twitter: @SusanJMorse
