About One-Fourth of Medicare ACOs Earned Shared Savings Bonuses
The results are from two ACO programs that began in 2012:
- The Medicare Shared Savings Program; and
- The Pioneer ACO program.
Altogether, the 333 MSSP and 20 Pioneer ACOs generated net savings of $411 million for Medicare in 2014. In addition, the ACOs generally improved their performance on most quality measures (Rappleye, Becker's Hospital Review, 8/25).
CMS said that the data show "that ACOs with more experience in the program tend to perform better over time" (Evans, Modern Healthcare, 8/25).
MSSP ACOs: How They Fared on Savings, Quality
Just 92 of 333 MSSP ACOs qualified for bonus payments in 2014 after reducing Medicare spending by a total of $806 million (Becker's Hospital Review, 8/25). The 92 ACOs received a combined $341 million in bonuses, while Medicare saved the remaining $465 million.
An additional 89 MSSP ACOs reduced costs compared with their benchmarks, but they did not qualify for incentive payments because they did not meet the minimum savings threshold. No MSSP ACOs will pay penalties to CMS for cost overruns in 2014 (CMS fact sheet, 8/25).
Of the MSSP ACOs that entered the program in 2012, 37% generated shared savings, compared with 27% that entered in 2013 and 19% that entered last year.
In addition, the report found that MSSP ACOs that reported in both 2013 and 2014 improved on 27 of 33 quality measures, including measures like ratings of physician communication and screening for tobacco use (Becker's Hospital Review, 8/25).
Of the 29 MSSP ACO participants that include California beneficiaries, just John Muir Health Medicare ACO earned shared savings payments, bringing in nearly $3.5 million. In addition, 11 California ACOs reduced costs compared with their benchmarks but did not qualify for incentive payments because they did not meet the minimum savings threshold (CMS data, 8/25).
During their third performance year, 15 of the 20 Pioneer ACOs generated $120 million in savings, a 24% increase from 2013. Eleven of the Pioneer ACO s qualified for a combined $82 million in shared savings payments.
Five Pioneer ACOs posted losses -- three of which will owe a total of $9 million in payments to CMS.
Pioneer ACOs also reported improving quality, with the average quality score rising to about 87% in 2014, compared with about 85% the previous year. Overall, organizations showed improvements on 28 of 33 quality measures.
While several Pioneer ACOs have dropped out of the program in recent years, CMS reported the program increased the number of covered beneficiaries by 2% to about 622,000 in 2014 (Becker's Hospital Review, 8/25).
Acting CMS Administrator Andy Slavitt said in a release, "These results show that accountable care organizations as a group are on the path towards transforming how care is provided."
CMS said that interest in ACOs is rising among providers and that it expects participation and the total number of beneficiaries covered to continue to grow. CMS in its release noted, "Since passage of the Affordable Care Act, more than 420 Medicare ACOs have been established, serving more than 7.8 million Americans with Original Medicare as of Jan. 1, 2015" (CMS release, 8/25).
Some experts see the relatively low rate of ACOs earning bonuses as a sign other cost and quality initiatives may be needed.
Kavita Patel, managing director of clinical transformations for the Brookings Institution's Center for Health Policy, said the results highlight the difficulty of controlling costs. "Delivering highly coordinated care is very difficult. An ACO is a start, but it's certainly not the ultimate solution," she explained.
Officials from two Pioneer ACOs that did generate savings-- Banner Health Network, which saved $29 million, and Montefiore ACO, which saved $18 million -- cited a focus on post-acute care as key to their success, Modern Healthcare reports (Modern Healthcare, 8/25).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.