Accountable care organizations (ACOs) save money and provide a higher quality of care for their patients, according to an announcement from CMS. The assessment was made based on the 2015 performance year results for the Medicare Shared Savings Program (MSSP) and the Pioneer ACO model, which along with all ACOs, had combined total Medicare program savings of $466 million that year.
ACOs are groups of physicians, facilities, and other health care professionals that agree to provide coordinated care to their patients to receive savings. ACOs use financial incentives to change behavior, such as paying more to physicians who coordinate care and use health information technologies. ACOs are judged on the care they provide, measured by various metrics. The Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) authorized two distinct ACO models.
The Pioneer ACO model, created by section 3021 of the ACA, is designed to support organizations with more experience in offering coordinated, patient-centered care. The program aims to test the payment arrangement of shared savings and shared losses, offering “higher levels of reward and risk than in the Shared Savings Program.” For the Pioneer program, ACOs agree to share their savings and losses with CMS, to a certain amount. Each Pioneer ACO had a minimum savings rate/minimum loss rate—if the gross savings/loss percentage was within that rate, the ACO neither received shared savings nor paid shared losses. If the ACO gained or lost more than their minimum rate, they either received a shared savings payment from CMS or owed CMS a shared loss payment, splitting the remaining amount.
Section 3022 of the ACA authorized the MSSP, which requires ACOs to meet certain quality metrics specified in CMS implementing regulations.
In 2015, there were 392 MSSP participants and 12 Pioneer ACOs. They showed significant improvements in the quality of care offered to Medicare beneficiaries, with all 12 Pioneer ACOs improving their quality scores by more than 21 percentage points from 2012 to 2015. MSSP ACOs that reported in both 2014 and 2015 showed improvements on 84 percent of the quality measures reported in both years, and average quality performance improved by more than 15 percent on key preventive care measures. Overall, 125 ACOs qualified for shared savings payments by meeting quality performance standards and their savings threshold.
CMS Acting Commissioner Andy Slavitt commended ACOs for their performance, saying, “The coordinated, physician-led care provided by Accountable Care Organizations resulted in better care for over 7.7 million Medicare beneficiaries while also reducing costs.”