Over the past several years, the Medicare Advantage program and the Medicare Shared Savings Program (MSSP) have both grown rapidly. As of 2021, more than 26 million people were enrolled in a Medicare Advantage plan. In contrast, the MSSP has 10.7 million beneficiaries in 2021 according to NAACOS. Although both programs are expanding, CMS has identified Medicare Advantage as a strategic growth area in value-based care. Medicare Advantage and ASO models are the fastest growing markets, at 7% and 2% enrollment CAGR (2014-2020). Additionally, Medicare Advantage enrollment has grown by 8% (CAGR) over the past two years, projected to reach 51% by 2030.
To gain market share and become successful in Medicare value-based programs, health systems and their participating ACOs need to proactively prepare and embrace this market shift.
Why Move From MSSP to Medicare Advantage?
In addition to CMS identifying Medicare Advantage as a strategic growth area, Medicare beneficiaries are also adopting Medicare Advantage in greater numbers. Since 2019, Medicare Advantage plans have the flexibility to address enrollees’ unanswered needs by targeting benefits to beneficiaries with chronic illnesses and offering a wider array of “primarily health-related” benefits. As of 2020, plans can also offer special supplemental benefits for the chronically ill (SSBCI). Additionally, the benefit design in Medicare Advantage is set up to help enhance patient engagement. Under a Medicare Advantage plan, the patient selects the health plan and the primary care physician. Under MSSP, the provider elects to participate and then they post notice, which means the patient may or may not know if they are even enrolled in the program.
Considering the pressure on health systems to assume two-sided risk, these opportunities make Medicare Advantage the better option to drive your risk strategy, improve quality, optimize risk adjustment, control costs, and improve financial outcomes. Furthermore, the STARS rating program, which offers positive financial rewards for quality improvement, is a stronger financial incentive than the negative quality adjustments that characterize some of CMS’s other value programs.
Steps to Take to Move from MSSP to Medicare Advantage
Medicare Advantage provides challenges that provider organizations may not be ready for. In moving to Medicare Advantage contracts, provider organizations need to be able to:- Evaluate if it is desirable to move a current MSSP ACO into a Medicare Advantage contract
- Evaluate the desirability of Medicare Advantage contracts when entering into new territories/regions
Beyond this, there are a number of considerations for providers if they decide to move from MSSP to Medicare Advantage. These include, but are not limited to:
- Care coordination staff for the provider needs to figure out how to tap the supplemental benefits that will improve patient outcomes
- There is a need to double down in risk adjustment, which provides a big opportunity to appropriately reflect the entire disease burden of the patient
- There is also a need for population or proxy data to evaluate the desirability of a Medicare Advantage contract for a population
- Model selected contracts with the terms defined in the payer contract
- Evaluate the impact of improving quality or optimizing risk adjustment
- Evaluate the impact of provider network modifications
- Perform scenario modeling with risk scores, medical loss ratio, and contract terms
- Analyze performance and financial reconciliation analytics, including upside/downside financial settlement and budget variance reporting
Once you’ve done the research and have worked through the checklist above, you and your provider organization will be ready to take the leap from MSSP to Medicare Advantage.
I welcome your feedback, and would be happy to provide more information on the specific ways that we are helping health systems advance value-based contracting with Medicare Advantage plans. Please feel free to email me at raj.lakhanpal@spectramedix.com with any questions or thoughts.
- Source: McKinsey EPT model, McKinsey Center for U.S. Health System Reform Medicaid Managed Care Program Database, IBIS, SNL, W all Street Research, and McKinsey analysis
- Source: Kaiser Family Foundation; Congressional Budget Office.
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