Beyond Historical & Forecasted Shared Savings by Provider
Besides weighing the historical and forecasted shared savings contribution by provider, an ACO benefits from an ability to calculate a handful of “supplemental metrics”. These metrics are described below and can be generated at the participant TIN and other meaningful provider network levels. In addition to performance incentives, they can guide strategic financial decisions, such as track and program entry, downside risk hedging, attribution methodology, participant selection and optimization of risk adjustment.
Regional Impact: Regional adjustment may provide an opportunity to take advantage of region-specific arbitrage. A negative regional adjustment sticks with the participant for the full agreement period and cannot be modified. Regional update factor by participant can lead to uneven benchmark contribution depending on how each participant’s region is trending.
Upside Potential of Risk Coding: Assess the upside “opportunity” of closing known HCC gaps for each participant. While there are many gap suspecting options, at minimum chronic conditions need to be re-coded annually. It is possible to estimate the “lift” to the benchmark for closing the gaps for each participant.
Contribution to Revenue Status & Risk Loss Limit: Each participant contributes to loss exposure proportionately to their revenue, making this an important metric for risk management. Additionally it’s possible to change the ACO’s revenue status by modifying the participant mix, such that its revenue capture dips under the 35% threshold. This impacts its track glide paths and the resulting loss exposure.
Attributed Lives: There’s a need to ensure that removing a participant would not risk dipping the ACO below the minimum bene requirement under Pathways. This may be especially important for smaller ACOs who are planning to switch from retrospective to prospective assignment.
Prospective vs Retrospective: The assignment methodology can impact the number of attributed lives, as well as how much control an ACO has to proactively manage patients. While the assignment methodology is made at the ACO level, it’s possible to assess which participants would be positively affected by the selection.
Quality Scores: Quality scores have a multiplicative effect on realizing a shared savings payout, making it important to estimate their breakout at the participant level.
Utilization Metrics: While utilization metrics don’t fully drive shared savings, the ability to break them out by participant has multiple benefits. It helps determine whether there are clear utilization outliers that would indicate possible modifiability of financial performance.