How ACO Flex Could Make Hospice ‘Top of Mind’ with Primary Care Providers

Collaborations with participants in the Centers for Medicare & Medicaid Innovation’s (CMMI) Accountable Care Organization (ACO) Primary Care Flex demo could allow hospices to leverage their skill sets to access more patients.

Hospices and palliative care providers can come to ACOs by two main avenues. They can become members of those organizations themselves, or they can contract with them through a preferred provider network.

In these preferred provider arrangements, the two parties can negotiate mutually beneficial terms that are customized to the needs and characteristics of their patient population. This may be increasingly important going forward. The U.S. Centers for Medicare & Medicaid Services (CMS) has announced plans to ensure that 100% of Medicare beneficiaries become aligned with an accountable care entity.


“It really is going to depend on the ACO. An ACO that is in an area with sicker patients, maybe they’ve got older, more frail patients — they’ve got an opportunity then to pull some of those payments and actually pay for a resource who actually is an expert in palliative care to support their population,” Dr. Kate Behan, chief medical officer of Arcadia, told Hospice News. “Another opportunity is by allowing more advanced primary care, you then give primary care physicians and other practitioners the opportunity to spend more time on palliative care and actually deliver palliative care that way.”

CMMI announced the new payment demonstration last month. Though the model is focused on primary care, it could help more patients receive hospice and palliative care when appropriate, according to CMS.

“The CMS Innovation Center understands that palliative and hospice care are critical to a patient’s care journey, and we anticipate that the ACO PC Flex model’s focus on primary care will help increase access to palliative care and hospice for individuals with Medicare,” a CMS spokesperson told Hospice News in an email.


This could also help facilitate earlier referrals to hospice if patients are receiving more robust and less fragmented primary care, according to Behan. In the context of most primary care environments, for example, clinicians often lack the time and training to conduct effective, compassionate goals-of-care conversations with seriously or terminally ill patients, she said.

By adopting more of a team approach, which ACO PC Flex is designed to facilitate, providers could free up more opportunities to have these in-depth discussions with patients and their family members. 

“There’s lots of opportunities here in terms of bringing palliative care and hospice care more front and center and more top of mind, frankly, to those on the care team to present that to their patients,” Behan said.

CMS plans to select close to 130 ACOs for the program. The voluntary five-year demonstration launches Jan. 1, 2025, with the application period starting May 20 and ending June 17.

Through the model, participating ACOs will receive a one-time advanced shared savings payment of $250,000, as well as a monthly Prospective Primary Care Payments (PPCPs), designed to provide flexibility to coordinate primary care delivery and enhance coordination with specialists, the CMS spokesperson indicated. ACOs will then distribute payment to the participating primary care providers in their networks.

The advance payments are also designed to help cover some of the costs of forming an ACO when appropriate, as well as administrative costs associated with the model. This can include investments in new technology for more robust data collection and analysis, which are necessary to demonstrate quality and cost savings, Behan indicated.

The PPCPs will also provide funds for care management, patient navigation, behavioral health integration and other care coordination services.

“The prospective, capitated payments for primary care in this model will make a huge difference. We’ve talked a lot in the last 10 years about ‘volume to value,’ and many times those have become empty words. We haven’t really kind of seen that shift,” Behan said. “This is a real opportunity to demonstrate true volume to value. We’re going away from fee-for-service, which represents volume, and going into that true value.”

If they are not already participating, ACOs will also have to apply to the Medicare Shared Savings Program (MSSP).

Thus far, these arrangements have paid off for CMS. The agency reported last year that its MSSP reduced spending by $1.8 billion in 2022, making it the sixth consecutive year the program has generated significant savings.

Currently, shared savings program ACOs include close to 575,000 participating clinicians who provide care to nearly 11 million Medicare beneficiaries, according to CMS.

Health equity is also a key component of ACO PC Flex. This is in keeping with CMMI’s stated strategy of incorporating those principles into all of its future payment model demonstrations, as it did with its ACO Realizing Equity, Access and Community Health (ACO REACH) program.

“[ACO Primary Care Flex] is in some ways going one step further by providing those payments upfront to really invest in those care teams that will make a difference,” Behan said. “By enabling more social workers, more community health workers, you can then address some of those disparities and hopefully start to address some of those health inequities. This takes it one step further.”

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