S3350

This bill, S3350, directly expands the basis for assigning Medicare fee-for-service beneficiaries to Accountable Care Organizations (ACOs). It mandates that beneficiary assignment reflect utilization of primary care services provided by physician assistants, nurse practitioners, and clinical nurse specialists within an ACO, in addition to services from ACO physicians. This change immediately increases the addressable patient pool for ACOs, leading to higher potential shared savings payments from the Medicare Shared Savings Program. The mechanism is regulatory relief, allowing ACOs to claim more beneficiaries and thus increase their revenue opportunities. The money trail flows directly to healthcare providers and insurers that operate or participate in ACOs. The increased patient assignment means a larger base for shared savings calculations. Companies with extensive networks of primary care providers, including those utilizing advanced practice providers, are positioned to capture this expanded revenue. Large health insurers that manage or partner with ACOs, especially those with significant Medicare Advantage enrollment, will benefit from the enhanced financial viability of these programs. The bill does not appropriate new funds but rather redefines the criteria for existing shared savings. Historically, expansions of Medicare beneficiary assignment criteria have led to increased participation and profitability for healthcare entities. For example, the 2018 Bipartisan Budget Act included provisions that encouraged ACO growth, leading to a steady increase in ACO participation and shared savings. While not a direct comparison to a specific bill, the trend shows that regulatory changes that expand patient attribution or payment models for value-based care generally result in positive financial outcomes for participating organizations. The market responded positively to these broader policy shifts, with healthcare insurance and provider stocks showing sustained growth in the periods following such legislative actions. Specific winners include large health insurers with significant Medicare Advantage and ACO footprints. UnitedHealth Group ($UNH) through Optum, CVS Health ($CVS) through Aetna, Humana ($HUM), Elevance Health ($ElevanceHealth), Molina Healthcare ($MOH), and Centene ($CNC) are all positioned to gain. These companies either operate large ACO networks or have substantial Medicare Advantage enrollment, which often aligns with ACO participation. There are no direct losers identified by this bill; it expands opportunities without diminishing existing ones. This bill is currently in the legislative process. Senator Barrasso, a Republican from Wyoming, is the sponsor, indicating bipartisan potential given the focus on efficiency and value-based care. The bill has one cosponsor and has been referred to a committee. If it passes, the changes would likely take effect in 2026, impacting ACO performance periods starting then. The next step is committee consideration and potential floor votes in both chambers.