Analysis of Accountable Care Organizations Shows Significant Savings

A recent analysis found that accountable care organizations (ACOs) reduced Medicare spending by $755 million from 2013 to 2017. Gross savings totaled $3.5 billion over the time period before payments for quality bonuses were awarded. Results show the Medicare Shared Savings Program’s savings continue to grow and are greater than other sources have credited the program. The Centers for Medicare & Medicaid Services (CMS) has judged performance based on benchmarks, an ACO’s annual, pre-determined spending target.

Analysis

“These results are undeniable,” said Clif Gaus, Sc.D., President and CEO of the National Association of ACOs (NAACOS). “There hasn’t been another voluntary initiative in Medicare that has generated billions in savings over such a short period of time.”

“Time and time again, ACOs have proven superior to Medicare’s other value-based care initiatives. CMS and Congress should look for ways to bolster ACO participation to further drive these savings,” Gaus said.

As noted by FierceHealthcare, the analysis was based on public files from CMS as well as data on provider participation and spending for assigned and unassigned Medicare beneficiaries. The analysis is the latest finding of savings for the ACO program. Data from the Medicare Payment Advisory Commission found that ACOs can lower Medicare spending by a rate of 1% to 2%.

Additionally, FierceHealthcare quoted Rob Mechanic, executive director of the Institute for Accountable Care. He noted that “ACOs have consistently since the beginning saved money” … “It has been fairly consistent year-to-year.”

He added that ACOs tend to perform better the longer they are in the program.

“It is an indication that CMS ought to continue to invest in this model because it has been the strongest performer of the various payment models they have tested,” Mechanic said.

CMS announced back in September that ACOs generated $739.4 million in net savings in 2018.