What's Up with Medicare in 2026?

Medicare ACOs are 10 years old this month. The program started in April 2012 with 27 approved ACOs. At the outset of the Medicare ACO program, Medicare communicated their vision of value-based care participants eligibility for a higher fee schedule in 2026.

Currently, beginning in 2026, all physicians participating in MIPS may receive an annual 0.25 percent increase in their fee schedule payments.

APM or value-based care program qualifying participants will receive a 5 percent lump sum bonus on Medicare Part B payments each year from 2019 to 2024.

Beginning in 2026, they may receive a fee schedule update of 0.75 percent each year. Qualifying APM participant will be excluded from MIPS and partial qualifying APM participants can elect to be excluded from the MIPS program.

In 2021, Medicare Board of Trustees' annual report to Congress released a new forecast . Many anticipated the report?would result in the Hospital Insurance Trust Fund, which finances Medicare Part A, running out of money faster than earlier projected due to COVID-19, however spending on COVID-19 was offset by the huge decline in other healthcare encounters.

The report still expects by 2026 that Medicare will be insolvent.

Spending in Medicare is expected to balloon from 4% of the country's gross domestic product to 6.2% by 2045, after which costs are expected to rise more slowly before leveling off at around 6.5% of the GDP, according to the report.

Medicare Advantage is booming in 2022. A?recent analysis ?from the Kaiser Family Foundation found that a record 3,834 plans were available for the 2022 plan year in MA, which represents an 8% increase over 2021 and the largest number on the market in a decade. In 2021, 26 million Medicare beneficiaries, or about 42% of those eligible for the program, were enrolled in an MA plan.

"As Medicare Advantage enrollment continues to grow, insurers seem to be responding by offering more plans and choices to the people on Medicare," the KFF analysts said.

At the outset of the Medicare ACO program, much discussion around Medicare vs. Medicare Advantage was had - which will win?

The first Performance Year of the redesigned ACO REACH model (formally the direct contracting model) will begin on January 1, 2023 and will run for four Performance Years: Performance Year 2023 (PY2023) through PY2026.

So, what happens in 2026?

We anticipate Medicare will again revamp their value-based care programs in preparation for 2026 and continue promoting participation in value-based care programs to assist in supporting their vision of reduction of costs and improved care.

As anticipated in 2012, when the first Medicare ACOs started, those organizations in value-based care will get paid more to continue their efforts toward the quadruple aim of - reduction in costs, improve health outcomes, improve patient experience, and improve staff experience.

2022 is a good time for healthcare organizations to re-evaluate their value-based care strategies. One of the primary obstacles to success in value-based care is sustainability of a program. Processes that may be successful in the short-term may not be successful in the long-term.

Book an appointment with Kris Gates, CEO Health Endeavors, to discuss your value-based care programs.