The leaders of the Washington, D.C.-based NAACOS, the National Association of Accountable Care Organizations, are touting the findings of a new study that they’ve sponsored, that indicate that ACOs have saved the Medicare program $8.5 billion, and underscoring ACOs’ contribution to supporting the future of the Medicare program.
NAACOS’s leaders on April 27 posted a summary of their study onto the organization’s website. As that summary notes, “An in-depth analysis from the National Association of ACOs shows that accountable care organizations (ACOs) have been living up to their promise of lowering the cost of health care while providing high-quality care for patients. Since their creation under the Affordable Care Act, ACOs have saved Medicare $8.5 billion and $2.5 billion [in gross savings and in net savings, since 2012], after accounting for shared savings payments, shared loss payments, and discounts to the Centers for Medicare and Medicaid Services (CMS).”
The summary continues on to state that, “As the Medicare trust fund is due to become insolvent in 2024 and as nearly 20% of all spending in this country is on health care, ACOs are an important way to control spending and incentivize providers to care about keeping their patients healthy in the long-term. An ACO is a group of health care providers who work to coordinate care for patients and have the potential to improve care delivery and reduce costs. Provider reimbursement is tied to quality measures and reductions in the cost of care.”
Indeed, the summary notes, “As relatively new Medicare programs, it took ACOs a few years to hit their stride and reach these levels of savings. Today, there are several ACO models, including the Medicare Shared Savings Program, Medicare’s largest value-based care program, and the Next Generation ACO Model, the Center for Medicare & Medicaid Innovation program comprising some of the leading ACOs in the country. In 2019, 582 ACOs in the two programs cared for 12.2 million patients, comprising 20% of all Medicare patients and nearly a third of traditional Medicare patients.”
As a result, “NAACOS anticipates the savings to the U.S. health care system and the Medicare program, in particular, will continue to grow as ACOs gain experience. According to the study, 80% of ACOs who started in 2012 or 2013 earned shared savings in 2019, compared to 38% of ACOs who started in 2018 and 2019.” And it quotes NAACOS president and CEO Clif Gaus, Sc.D., as stating that “This illustrates the long-term commitment required by ACOs and that success doesn’t happen overnight, but take years of hard work.” Those savings involved savings created by ACOs participating in both the Medicare Shared Savings Program (MSSP) and the Next Generation ACO (Next Gen ACO) Program.
The full analysis, also published to NAACOS’s website, includes a large number of data points, including these 2019 results:
Ø Shared Savings Program ACOs generated $2.65 billion in savings compared to their benchmarks, which are CMS-set financial targets, recording their best year yet.
Ø Next Gen ACOs saved $559 million compared to their benchmarks, also a program high.
Ø Three-quarters of ACOs saved Medicare money, also highs for both programs.
Ø Shared Savings Program ACOs generated an average savings of $262 per patient compared to their benchmarks.
Ø MSSP ACOs received an average quality score of 94.77 percent, a new program best.
Ø MSSP ACOs that earned shared savings received an average of $5.2 million each in 2019.
Ø Just eight MSSP ACOs shared losses paying a combined $17.6 million.
Two other key sets of highlights put forward in the full report involve quality and performance improvement over time.
As the report notes:
“Quality continues to improve, out-pace other medical practices
• MSSP ACOs received an average quality score of 94.77 percent, a new program high, while Next Gen ACOs received an average quality score of 93.73 percent.
• 92 percent of eligible MSSP ACOs earned quality improvement reward points in 2019, with ACOs showing the greatest improvements in the patient safety and care coordination quality domain.
• All MSSP ACOs met performance standards, which are required before they are eligible to receive shared savings payments. ACOs get better with time
• As we’ve seen in years past, more experienced ACOs have done better at saving Medicare money. Table 1 below shows the percent of ACOs that earned shared savings by their start year.
• 80 percent of ACOs who started in 2012 or 2013 earned shared savings in 2019, compared to 38 percent of ACOs who started in 2018 and 2019. This illustrates the long-term commitment required by ACOs and that success doesn’t happen overnight but take years of hard work.
• ACOs that started in in 2012 or 2013 and earned shared savings netted an average of $3.96 million each to the Medicare Trust Fund, compared to $1.11 million each for ACOs that started in 2018.
