Health Care Matters | August 29
The ACPT: Why We Have It And Four Ways To Improve It
In 2024, the Centers for Medicare and Medicaid Services (CMS) introduced the Accountable Care Prospective Trend (ACPT) as part of a three-way blended formula to update historical benchmarks for Accountable Care Organizations (ACOs) in the Medicare Shared Savings Program. The ACPT, which receives one-third weight in benchmark calculations alongside national and regional Medicare spending growth rates, uses prespecified growth rates based on forecasted spending to address longstanding "ratchet" and "collective success" problems that have plagued ACO benchmark setting. However, 2024 proved challenging as actual national Medicare spending grew up to 4 percentage points faster than the ACPT forecast, driven partly by questionable use of high-priced skin substitutes and other unclear factors. This gap between forecasted and actual spending created financial pressure on ACOs and raised concerns about program participation, prompting CMS to retroactively reduce the ACPT's weight from one-third to one-sixth for 2024. Authors in this Health Affairs article examine the motivation of the ACPT and highlight changes needed to improve the methodology. Read here.
Why It Matters
The ACPT represents ongoing evolution in Medicare's approach to population-based payment models, as it allows benchmarks to diverge from realized spending when ACOs collectively succeed in reducing costs, addressing a fundamental flaw that previously penalized successful cost management. Notably, CMS did not propose any changes to the ACPT methodology in the 2026 Medicare Physician Fee Schedule proposed rule, suggesting 2024's spending surge could be anomalous rather than indicative of a systematic problem. We expect CMS to take a wait-and-see approach, monitoring whether 2025 and beyond show similar patterns of actual spending significantly exceeding ACPT forecasts. If spending volatility continues and CMS finds itself repeatedly using regulatory levers to adjust ACPT weights mid-stream, this will likely trigger more formal policy changes incorporating the authors' recommended improvements such as establishing guardrails, setting uniform ACPTs across cohorts, and adjusting for price changes and new technologies.
Enhancing Oncology Model First Annual Evaluation Report
The first evaluation of CMS's Enhancing Oncology Model (EOM) revealed mixed outcomes for the 44 participating oncology practices in its initial six months. While practices achieved $13.1 million in Medicare payment reductions primarily through reduced cancer drug spending, the program resulted in a net $13.2 million loss to Medicare after accounting for incentive payments to participants. Notably, 70% of EOM participants were veterans of the predecessor Oncology Care Model (OCM), and these practices were significantly larger with nearly three times more oncology practitioners than non-participating practices. Read more here and here.
Why It Matters
The results warrant cautious interpretation due to potential selection effects. EOM launched with only 44 participants compared to the predecessor OCM's 190 initial participants. The heavy representation of experienced OCM practices with already-lower baseline costs suggests these early results may reflect sophisticated practice selection rather than broad model effectiveness. For policymakers and practices considering participation, this raises important questions about whether EOM's apparent drug spending reductions would be replicable across less experienced or smaller oncology practices, potentially limiting the model's scalability and real-world impact.
Look for the Helpers: Breaking Down Barriers to Recovery
The Jersey County (IL) Health Department's new Recovery Oriented Systems of Care council is working to reduce the stigma around substance abuse recovery in a community hit hard by opioids, where the overdose mortality rate is nearly twice the national average. Led by coordinator Rachel Klocke, the council connects recovery service providers and aims to make treatment resources more accessible to residents. The group is also addressing transportation barriers, the biggest reason for missed appointments, by exploring partnerships with local public transit to help people reach the care they need. Read here.
What We Are Reading
Hospital Participation in Medicare ACOs: No Change in Admission Practices and Spending
A new study in The American Journal of Managed Care found that hospitals participating in Medicare accountable care organizations showed no significant changes in emergency department admission rates, length of stay, or costs for unplanned admissions over five years, suggesting limited effectiveness of hospital-led ACOs in reducing acute care spending. Read here.
Op Ed: A National Call to Modernize Health Care
Amy Gleason, strategic advisor to HHS and acting administrator of the U.S. DOGE Service, calls for modernizing health care technology in the Los Angeles Times, arguing that the federal government is building foundational infrastructure like a national provider directory while urging private sector innovation to create seamless, AI-powered health management tools that could transform patient care from disconnected paperwork to personalized, real-time support. Read here.
A Decade of VBC
Medical Economics Insider's July/August 2025 issue examines value-based care ten years after MACRA's passage, finding that while the concept of linking payment to better care is sound, the transition has been slow and uneven due to limited Advanced Alternative Payment Models, administrative burdens, and the challenge for small practices to navigate both fee-for-service and value-based contracts simultaneously. Read here.
Quality Measurement in Healthcare
A new book "Quality Measurement in Healthcare" provides a comprehensive guide with 15 chapters on how to define, implement, and leverage quality measurement to drive meaningful improvements in patient outcomes, covering topics from patient-reported outcomes and electronic health records to addressing healthcare disparities and navigating value-based care complexities. For more, click here.
What We Are Writing
A National Action Plan To Strengthen Support For Informal Caregivers
In a recent article published in Health Affairs, Coral Health Advisors' Katelynne J. Freeman and Sarah Kolk alongside Coral allies Hope Glassberg of Decipher Health Strategies and Shira Hollander of Tripp Hollander Advisors outline a national action plan to strengthen support for informal caregivers, offering strategies to expand financial supports, provide training and wraparound resources, and integrate caregivers as essential members of care teams. Most importantly, it helps elevate the voices of the caregivers who sustain our health system every day. Read here.
What We Are Attending
Connect and learn about ACOs and other value-based care models on October 8-10 at the NAACOS Fall 2025 Conference in D.C.! The agenda features expert-led sessions, including CMS leaders Chris Klomp and Abe Sutton and Dr. Pippa Shulman of DispatchHealth, a pioneer in delivering acute care in the home. The event offers networking for participants, speakers, and vendors to share ideas, explore partnerships, and gain insights. Register for the in-person conference with code 'HCMEarlyRate' to receive a discount of $300 per person or for the live webcast with code 'HCMVirtualEarly' for a discount of $100. For registration questions or issues, please contact conference@naacos.com.
Job Opportunity
The CMS Innovation Center is hiring for several positions to support health system transformation initiatives. Current open roles include economist, nurse, health insurance specialists. Click the links below to learn more and apply by September 2:
Pop Health Podcast
Designing Maternity APMs That Work: Lessons from the Field
In this episode, Coral’s Kate Freeman and Trevor Abeyta talk with Megan Burns and Carol Sakala about CMS’s Transforming Maternal Health (TMaH) model, lessons from value-based maternity care, and strategies states can use to improve maternal health outcomes.