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What Risk-Based Payment Models Mean for You - APM

As the American healthcare system shifts from quantity-based pricing models to those that incentivize positive outcomes for the patient, clinicians must rethink and reshape their businesses. This is shown by the transition from fee-for-service models with a volume-driven approach to risk-based payment models that expect clinicians to improve the quality of their care while cutting costs.

These models exist in two primary forms: Advanced Payment Models (APMs), such as Accountable Care Organizations, also known as ACOs, and the Merit-based Incentive Payment System, or MIPS. While the two overlap a bit, there are key differences that can affect how much clinicians are paid for the care they provide — and their ability to achieve positive care results. Choosing the right model will become essential as fee-for-service models go by the wayside, but ChartPath can prepare you for the change, whichever one you choose. In this blog we will be focusing on APMs for ACOs; check out this blog to review MIPS strategies.

Traditional Advance Payment Models: ACOs

Traditional advance alternative payment models can take several forms, but the goal is the same: minimize costs while raising standards of care. Administered by the Center for Medicare Services' (CMS) Quality Payment Program (QPP), advanced alternative payment models (APMs) offer incentives to organizations that meet certain thresholds in the administration of their care. Some of these benefits include:

  • Exclusion from MIPS reporting and payment adjustment
  • Up to a 5% APM incentive payment between performance years 2017 and 2022
  • An increased physician fee schedule update based on the QP conversion factor for performance years 2024 and beyond

One of the most common APM subgroups are accountable care organizations or ACOs. Taking a collaborative approach to risk sharing, ACOs are defined by CMS as "groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated, high-quality care to their Medicare patients." The goal is to reduce service duplications, prevent errors in the delivery of care, and equip clinicians with the resources they need to best care for their patients.


There are 483 ACOs nationwide providing care to over 11 million Medicare recipients. As long as they improve the quality of care and cut costs like CMS desires, they can be structured in whatever way meets the needs of the patients they serve. One program of particular note is the Accountable Care Organization Realizing Equity, Access, and Community Health, or ACO REACH.

Set to launch on Jan. 1, 2023, ACO REACH is an upgrade from the former Global and Professional Direct Contracting Model (GPDC). It focuses more on advancing health equity, increasing stakeholder feedback, and meeting the healthcare needs of those in underserved communities. ACO REACH meets these goals by:

  • Promoting provider leadership and governance.
  • Protecting beneficiaries and the model with more participant vetting, monitoring, and greater transparency.
  • Providing greater health equity to underserved communities by ensuring their needs are considered.

In an effort to grant clinicians as much flexibility as possible to tailor their programs to their communities, ACO REACH offers multiple tiers of service and participation options. These include a standard, new entrant, and high-needs population ACO subgroup, along with professional and global risk-sharing options.

HCC Coding Proficiency Strategy

No matter which risk-based payment model is implemented, a scoring system must be in place to determine the severity of each patient's health risk so that clinicians are evaluated fairly — and that's what HCCs are for.

Short for Hierarchical Condition Categories, HCCs use ICD-10 codes for billing to assess an individual's health risk according to the notes documented within their chart. When clinicians treat patients with a higher HCC score, their reimbursement rates are also higher. These scores also determine reimbursement rates for the following year, so developing a clear HCC coding proficiency can impact present profits and future margins.

A Tool for the Job

To help them better navigate their risk-based payment models, ChartPath features a series of functionalities that can help improve their quality metrics. Some of these are:

  • Benchmark monitoring. ChartPath EHR lets clinicians see the thresholds to meet for each benchmark, helping them score well on each metric and view their progress throughout the year. That way, they can maximize their grade to get the largest reimbursement rate possible and avoid costly penalties by falling short.
  • Quality Measures data tracking. Equipped with a "soft stops" feature, clinicians can keep a continual tab on each patient's chart and the quality metrics therein. The "hard stops" feature also lets clinicians know when no further documentation can occur until a specific action has been taken — and both improve quality scores and, subsequently, reimbursement rates.
  • Versatility. From pull-forward tabs that make documenting patients' chronic conditions easier to Top Picks buttons that let clinicians select the most common medical diagnoses, ChartPath has many functionalities that help clinicians work smarter, not harder.
  • Insights. ChartPath's software links ICD-10 codes to HCC categories, giving clinicians better visibility into how they're being scored.

One of the greatest benefits of ChartPath EHR is our end-to-end support. We can guide you through the HCC coding process and help you select the benchmarks that will boost your scores the most, and our fast startup times can help your practice transition to a risk-based payment model in as little as three months. Preparation is essential, though; before making the switch, clinicians should have all of their patients' scores properly weighed by the end of the preceding year in which they enter their ACO or MIPS contract. That's why it's better to start sooner than later.

Make the Switch with ChartPath

Risk-based payment models are designed to meet the goal of every clinician: to give their patients better care. Both ACOs and MIPS take helpful steps toward that end but knowing which to choose can be a challenge. ChartPath journeys with their clients through every step of the journey, ready to help in any way we can. Schedule a demo to see just how you can step into the future of delivering better care.

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