Trump Administration Announces Details of New Rural Health Model

The Centers for Medicare and Medicaid Services (CMS) recently unveiled the details of the Trump Administration’s long-awaited, new rural health payment model, the Community Health and Rural Transformation (CHART) Model. The CHART Model aims to, “[Unleash] innovation through new funding opportunities that will increase access and improve quality,” by allowing a limited number of rural health providers to participate in one of two tracks, the Community Transformation Track and the Accountable Care Organization (ACO) Transformation Track. According to CMS, this new model comes as a response to President Trump’s Executive Order on Improving Rural Health and Telehealth Access that was made on August 3rd, as well as the President’s Medicare Executive Order and CMS’s Rethinking Rural Initiative.

The Community Transformation Track will include up to 15 lead organizations. These lead organizations are entities representing a rural communities comprised of either a single county or a set of contiguous or non-contiguous counties. This track will create a $75 million grant program for the 15 organizations to share. This experimental track aims to give these up-front dollars to providers and allow them greater flexibility to create their own health care programs with a patient focus.

The ACO Transformation Track builds on the successes the very popular and successful ACO Investment Model (AIM) program. In this model, CMS will select 20 rural-focused ACOs to receive advanced payments to engage in value-based payment efforts aimed at improving outcomes and quality of care for rural beneficiaries. We are supportive of this new and exciting opportunity, but we also want to acknowledge that how CMS currently sets spending benchmarks disadvantages certain rural providers. Currently, CMS compares the per-patient costs of a region’s ACO with the operating expenses of its non-ACO competitors, but rural ACOs are often the only significant provider in their region. Thus, rural ACOs often face a much lower spending benchmark, because urban and suburban regions often have more non-ACO providers. We are calling upon CMS to fix this ‘rural glitch’ within the MSSP. This is a critical and common-sense step towards establishing greater payment for rural providers that are providing high quality care to their communities while decreasing health care spending. Unlike the earlier AIM program, participants in the ACO Transformation Track will enter into two-sided risk arrangements as part of the Medicare Shared Savings Program (MSSP), which could be a barrier to entry for many rural hospitals unwilling to bear risk without being able to define that risk completely. Additionally, a CHART ACO is limited to 10,000 covered lives which could increase actuarial volatility in participating in a dual-sided risk program.

The timeline indicates that a Notice of Funding Opportunity (NOFO) for the Community Transformation Track will be available in September on the Model Website and the Request for Application (RFA) for the ACO Transformation Track will be available in early 2021.

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