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May 21, 2019
AMGA Survey Shows Increased Reliance on Risk-Based Revenue
External Obstacles Impeding Move to Value Remain Unchanged
Alexandria, V.A. – AMGA's Fourth Annual Risk Survey found that many multispecialty medical groups (MSMG) and integrated delivery systems (IDSs) increased their use of risk-based revenue sources in federal and commercial settings from 2015 to 2018, with Medicare Advantage (MA) being the most dominant payment model (30%). The survey results, detailed in a white paper entitled “Taking Risk, 4.0: Clearing a Pathway to Value-Based Care,” also found that significant impediments existed in the move to value and respondents felt these obstacles need to be addressed by policymakers to ensure the transition away from fee-for-service (FFS) payments continues.
From 2015 to 2018 in the federal setting, FFS payments decreased from 55% to 44% of revenue. MA payments increased from 22% to 30% of revenue over that same period. Medicaid (combined FFS and risk-based) payments remained flat at 20% of revenue. While revenue from the federal Accountable Care Organization (ACO) program increased by 36% during this period, the data showed that ACO revenues have flattened since 2016. Bundled payments remained constant at 1% of total revenues.
Risk-based payments in the federal setting accounted for 56% of total revenues in 2018, including 30% from MA and 15% from ACOs. By 2020, respondents predict MA revenues will outpace Medicare FFS revenues by 6% and revenue from downside-risk ACOs will generate twice as much revenue as upside-only ACOs.
Between 2015 and 2018, FFS payments in the commercial setting decreased from 78% to 72% of revenue. ACO payments increased from 12% of revenue to 16%, with most of the growth coming from upside-risk-only ACOs. Capitated payments increased from 8% to 11% of revenue. Bundled payments were not a significant revenue source from 2015 to 2018.
Risk-based payments in the commercial setting accounted for 28% of total revenues in 2018. By 2020, respondents expect risk-based payments to increase to 37% of total revenues, shared-risk ACOs to increase from 6% to 11% of total revenues, and shared-savings ACOs payments to increase from 10% to 12%. Full- and partial-capitation payments are predicted to remain flat at 7% and 3% of total revenues, respectively.
“When comparing survey responses from the 2015 and 2018 surveys, it is clear that AMGA members are moving to value,” said Jerry Penso, M.D., M.B.A., AMGA president and CEO. “AMGA members believe value-based models support their team-based, coordinated, data-driven model of care, which results in better patient outcomes.”
Impediments to Value
Respondents reported two types of barriers to taking on risk, external and internal. For the fourth year in a row, a lack of access to administrative claims data remains the most significant external obstacle to moving to value. Other external impediments are largely payer-driven and involve the lack of a uniform data submission and reporting standard, multiple quality measurement programs, and problematic financial benchmarking and risk-adjustment methodologies, particularly in the federal ACO program.
Internal impediments involve building and financing the infrastructure necessary to take risk, change management challenges, and physician compensation issues. When comparing survey responses from 2015 and 2018, it appears that medical groups are addressing internal impediments to moving to value-based payment.
“This year’s survey shows AMGA members are making the costly financial investments necessary to address impediments within their control,” said Chet Speed, J.D., LL.M, AMGA chief policy officer and primary white paper author. “However, the survey responses also indicate that AMGA members are frustrated over the lack of attention external impediments are receiving from stakeholders and policymakers. These barriers must also be addressed to ensure momentum towards value-based care is not halted.”
About the Survey
AMGA’s annual Risk Survey gauges the progress of AMGA members in their transition to value, what barriers to risk or value are hindering them, and what percentage of member revenues are currently risk-based. AMGA’s Fourth Annual Risk Survey received responses from 75 member organizations. Results are presented overall and stratified by demographics: number of FTE physicians, organization type, and geographic region.
The survey is available to download.
AMGA is a trade association leading the
transformation of health care in America. Representing multispecialty medical
groups and integrated systems of care, we advocate, educate, innovate, and
empower our members to deliver the next level of high performance health. AMGA
is the national voice promoting awareness of our members’ recognized excellence
in the delivery of coordinated, high quality, high-value care. More than 175,000
physicians practice in our member organizations, delivering care to one in three