News | Accountable Care Organizations

Dec. 17-21: Report Highlights Savings of Existing Medicare ACOs

News | Accountable Care Organizations

Dec. 17-21: Report Highlights Savings of Existing Medicare ACOs

Dec. 13—As the Trump administration considers a controversial overhaul of Medicare’s accountable care organization (ACO) program, a new report says the existing model has provided much more savings than previously found.

A final rule overhauling the Medicare ACO program is expected to be issued by the end of the year.

Dec. 13—As the Trump administration considers a controversial overhaul of Medicare’s accountable care organization (ACO) program, a new report says the existing model has provided much more savings than previously found.

The evaluation by analytics firm Dobson|DaVanzo & Associates, which was conducted for the National Association of ACOs (NAACOS), found that from its launch in 2013 through 2016, the Medicare Shared Savings Program (MSSP) saved Medicare $2.66 billion. The total far surpassed the $1.6 billion in savings previously found by the Centers for Medicare & Medicaid Services (CMS).

The report compared ACO spending to that of similar, non-ACO providers and used the difference to project what spending would have occurred in the absence of ACOs. In contrast, CMS uses a benchmark approach to track ACOs’ annual, predetermined spending target. Critics say the CMS approach underestimates ACOs’ performance, and some researchers have agreed that the difference-in-difference approach is a more accurate method for tallying the effect of MSSP ACOs on medical costs.

Additionally, the report found that the MSSP provided net savings for Medicare every year, even after accounting for the bonus payments for participating providers that met quality and spending targets. The total $666 million in net savings to Medicare found by the Dobson report contrasted with the $384 million in net losses found by CMS.

Currently, 561 MSSP ACOs provide care for 10.5 million patients.

The report is the second from NAACOS to track MSSP savings. A first analysis, which NAACOS released in September, found MSSP ACOs saved $1.8 billion from 2013 through 2015 and reduced Medicare spending by $542 million.

“These results are the latest data point in a growing body of evidence unequivocally proving ACOs’ value,” Clif Gaus, ScD, president and CEO of NAACOS, said in a release. “ACOs are saving American taxpayers hundreds of millions of dollars at a time when it’s most needed.”

Even CMS found that the 472 ACOs in the MSSP in 2017 generated $314 million in net savings to Medicare after accounting for bonuses paid to ACOs, according to an analysis of performance data that the agency released in August.

Changes Coming

The latest MSSP report came as ACO advocates and operators are bracing for a final rule that is expected to overhaul the program. That final rule arrived in early December at the Office of Management and Budget, which conducts the last stage of regulatory review before a rule is publicly issued. Some industry advisers expect the final rule to be issued before the end of the year.

Three national hospital groups wrote a September letter to CMS urging a series of changes to the proposed overhaul of the MSSP.

The groups, which included America’s Essential Hospitals and Premier, warned that the proposed ACO changes “would have unintended consequences of undermining the broader shift to value-based care.”

The ACO supporters were most concerned with proposals to shorten from six years to two years the period of upside-only risk for new ACOs and to cut in half—from 50 percent to 25 percent—the shared-savings rates for ACOs.

In a Spring 2018 survey, more than 70 percent of ACOs said they would leave the program if they were required to take on risk for 2019.

Telehealth Use

Recent ACO research included a study in the December issue of Health Affairs that found disappointing telehealth results for one large ACO.

The researchers examined data on more than 35,000 patients at an ACO-based medical specialty practice in Massachusetts in 2014–17 and found that virtual visits replaced in-person doctor visits only about a third of the time.

Sachin Shah, MD, MPH, assistant professor of medicine at the at the University of California San Francisco, and coauthors found that the decrease in in-person visits was short-lived. While patients saw their physicians in person significantly less in the first three months after enrolling in the virtual-visit program, after one year, patients who used virtual visits saw their physicians in person just as frequently as patients who did not enroll in the program.

The authors concluded that the virtual visit may be a viable tool for ACOs seeking alternatives to traditional, high-cost specialty care. However, more work is needed to determine how virtual visits can substitute for in-person care in the long term.

Monday, Dec. 17

Webinar by CMS titled “Public Reporting: Exploring the Next Generation of Preview Reports.” Learn more.

Webinar by the Health Resources and Services Administration on grants to develop new rural residency programs or training tracks in family medicine, internal medicine, and psychiatry to expand the physician workforce in rural areas. Learn more.

Deadline to submit comments on a proposed rule by the Department of Health and Human Services  (HHS) requiring new drug price transparency. Learn more.

Tuesday, Dec. 18

Webinar by HFMA titled “Leveraging Data & Business Intelligence to Improve Provider Productivity.” Learn more.

Webinar by CMS titled “Navigating Hospital Compare.” Learn more.

Webinar by CMS titled “2019 IPPS Final Rule and Changes to the Medicare Promoting Interoperability Program” (rescheduled from Dec. 5). Learn more.

Webinar by America’s Health Insurance Plans titled “HEDIS—Reaching for the Stars.” Learn more.

Webinar by the American Hospital Association titled “Specialty Pharmacy Revenue Opportunity: Infusion.” Learn more.

First meeting of the HHS Deputy Secretary’s Innovation and Investment Summit. Learn more.

Wednesday, Dec. 19

Webinar by HFMA titled “An Overview of the Office of Inspector General’s Work Plan.” Learn more.

Webinar by the Medicaid Health Plans of America titled “Reduce costs by providing better access to health and wellness services for your Medicaid members.” Learn more.

Hearing by the House and Senate committees on Veterans Affairs titled “Tracking Transformation: VA MISSION Act Implementation.” Learn more.

Thursday, Dec. 20

Webinar by HFMA titled “Motivating a New Culture of Collections.” Learn more.

About the Authors

Rich Daly

is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

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