Somewhat lost in the hustle and bustle of the year-end holidays was the announcement by the Centers for Medicare & Medicaid Services (CMS) on Dec. 23, 2013, of the latest cohort of 123 Medicare Shared Savings Program (MSSP) accountable care organizations (ACOs), whose performance period began on Jan. 1, 2014.
This recent class is the most sizable to date—16 percent larger than the prior year’s cohort of 106—and it continues the MSSP’s trend of becoming progressively larger. Based on public announcements by CMS, there are an estimated 367 Medicare ACOs in total, comprising 23 Pioneer ACOs and 344 MSSP ACOs.
The distribution of the total pool of Medicare ACOs aligns pretty well with the distribution of the Medicare beneficiary population, with six of the top 10 states as measured by number of ACOs among the top 10 states in terms of Medicare beneficiary population.
Some interesting observations can be gleaned from comparing the latest cohort with the prior year’s class and the total pool of ACOs that preceded the latest cohort.
First, multistate ACOs are on the rise. Of the most recent cohort’s 123 ACOs, 42 of them (34 percent) are multistate, while only 24 percent of the 244 Medicare ACOs in previous cohorts are multistate. The increase in multistate ACOs may reflect a generally more sophisticated strategy that incorporates stronger IT infrastructure and more robust processes to support a multistate enterprise.
Second, eight states—California, Kansas, Michigan, New York, North Carolina, Pennsylvania, Texas, and Virginia—indicate growing momentum, with significant increases in the number of new ACOs in the latest cohort relative to the number in last year’s class and to the total number of ACOs that preceded the latest cohort.
Third, it is apparent that three states—Connecticut, Georgia, and Massachusetts—may have been somewhat saturated previously, with sharp year-to-year declines in the number of new ACOs coming onboard.
And fourth, while the 367 Medicare ACOs have headquarters across 44 states and Puerto Rico, a limited number of adjacent-state clusters account for a majority of the Medicare ACOs. Massachusetts, New Jersey, and New York, with 58 ACOs, account for 16 percent, and Florida’s and Georgia’s 55 ACOs represent 15 percent. California and Arizona have 41 ACOs, accounting for 11 percent, while Maryland, Virginia’s and North Carolina’s 39 ACOs also represent 11 percent. In the Midwest, Illinois, Indiana, and Michigan have a total of 34 ACOs, accounting for 9 percent. If one adds Texas, with its 28 ACOs, to the list, 14 states account for 70 percent of all Medicare ACOs.
With the addition of the latest cohort of 123 ACOs, it is clear that the Medicare ACO march has not only continued, but also picked up its pace.
Ken Perez is Vice President of Healthcare Policy for Omnicell, Inc., in Mountain View, Calif.
Publication Date: Thursday, January 30, 2014