Accountable for Health Feedback on Transforming Episode Accountability Model
Background
The mandatory Transforming Episode Accountability Model (TEAM) advances the Innovation Center’s work on episode-based or bundled payment models. TEAM will launch on January 1, 2026, and is scheduled to run for five years. Selected acute care hospitals will coordinate care for people with traditional Medicare undergoing certain surgical procedures included in the model. Participants will be responsible for the cost and quality of the model from surgery through the first 30 days after the beneficiary leaves the hospital. CMS used core-based statistical areas (CBSAs) to identify selected geographic regions for the model test. The goal of the model is to reduce fragmented care after surgery, which can lead to complications, prolonged recovery, and potentially avoidable care.
Resources
- CMS Innovation Center TEAM Model Webpage
- Inpatient Prospective Payment System Final Rule (including the list of proposed Core-Based Statistical Areas)
- TEAM Infographic
- A4H Comment Letter
| Key Takeaways |
|---|
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| Issue | CMS Proposal | A4H Comment | CMS Final |
|---|---|---|---|
| Extending upside only participation for safety net, rural and critical access hospitals | CMS proposed three tracks in TEAM, each with differing financial risk, participation and quality performance adjustments. Safety net, rural and critical access hospitals would be required to move to two-sided risk after one year. | A4H expressed concern about proposed mandatory two-sided risk for safety net hospitals. A4H asked that CMS consider making their participation optional. | Final rule lengthens the period of time that a safety net hospital can stay in Track 1, upside only risk, now allowing 3 years of participation in upside only risk. |
| Addressing model overlaps between TEAM and Total Cost of Care Models | CMS proposes to permit overlaps with TEAM and total cost of care or shared savings models or programs. CMS proposed allowing savings generated in each model to be retained by each model. | A4H supported this proposed approach of allowing each participant to retain their savings. A4H proposed allowing ACOs participating in two-sided risk APMs to be permitted to have their participating hospitals opt out of TEAM. | CMS finalized proposals for model overlap to allow overlap between shared savings or total cost of care models with TEAM episodes, including allowing both TEAM participant and total cost of care model or program participant to retain savings generated from their perspective performance in their model or program without recoupment. CMS did not permit allowing ACOs in two-sided risk arrangements to opt out of TEAM. |
| Reducing the discount | CMS proposed a discount factor of 3% to the benchmark price to serve as Medicare’s portion of reduced episode expenditures. | A4H believes that a 3% discount is too high for a mandatory model and urged CMS to reduce the discount to no more than 1%. | In the final rule, CMS reduces the discount on an episode-specific basis. CMS finalized a 2% discount factor for the LEJR, SHFFT, and Spinal Fusion episode categories and a 1.5% discount factor for the CABG and Major Bowel Procedure episode categories. |
| Correcting the low-volume threshold to protect participants | CMS proposed a low-volume threshold of 31 episodes in the baseline period of PY 1. | A4H commented that this threshold is too low to protect participants from catastrophic losses. | CMS will propose and finalize a specific length for the lookback period and alternative low-volume policy through subsequent rulemaking. |
| Encouraging primary care referral and connectivity between TEAM and ACOs | CMS proposes that a TEAM participant must include a referral to a supplier of primary care services for a TEAM beneficiary on or prior to discharge from an anchor hospital or procedure. | A4H supported the requirement and recommended that CMS explore additional safeguards to ensure patients already aligned to a provider could be tucked back in to that provider. We suggested CMS could consider warm hand of codes and/or that ACO patient rosters be incorporated in participating hospital EMRs if requested by the ACO in their market to facilitate communication between overlapping beneficiaries. | CMS recognized the value in monitoring but declined to implement safeguards. CMS indicated that claims-based monitoring could be burdensome to TEAM participants and to CMS. CMS also declined to require access to ACO alignment information in the EHR, citing financial and administrative burden on participants. But, the agency is encouraging participants to consider how they can use their resources, including TEAM data to identify aligned beneficiaries. |
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