Accountable care organizations saved more than $380 million after their first year, but only 29 were able to share in the savings.
The Centers for Medicare & Medicaid Services reported yesterday the findings from the Medicare Shared Savings Program (MSSP) and Pioneer ACOs models, which are designed to realize savings over several years.
[See also: Accountable care organizations: cost-effective solutions or financial sinkholes?.]
Nearly half, or 54 out of 114, of the low-risk MSSP ACOs that started operation in 2012 “had lower expenditures than projected,” CMS said in a news release, and of the 54 ACOs, only 29 were able to share savings of $126 million. ACOs share with Medicare any savings generated from lowering the growth in healthcare costs while meeting stated measures for quality care. The ACOs generated $128 million in net savings for the Medicare Trust Funds.
Final results for the first year’s performance will be released later this year, CMS said. The agency anticipates that the majority of the program’s impact will phase in over the subsequent years, but the statistics demonstrate that it is difficult to significantly lower spending even for voluntary early adopters who are keen on healthcare reforms.
The Pioneer ACO model, which is aimed more toward organizations ready to assume more risk, produced $147 million in gross savings in the first year. Of the 23 Pioneer ACOs, nine had significantly lower spending growth relative to Medicare fee-for-service while also outperforming quality reporting requirements. There were originally 32 Pioneers, but nine dropped out or moved to the lower risk Medicare Shared Savings Program.
[See also: Pioneer ACOs show savings.]
CMS also released results for the Physician Group Practice Demonstration, which offers incentive payments for delivering high-quality, coordinated healthcare that also generates savings for Medicare. Over five years, seven out of 10 physician group practices earned shared savings payments totaling $108 million for improving quality of care and cost efficiency.