The Centers for Medicare & Medicaid Services (CMS) today released results for how the 472 Medicare Shared Savings Program (MSSP) accountable care organizations (ACOs) performed in 2017.
Although CMS released the data in raw Excel format, multiple industry observers have pointed out that it was a great year for the federal ACO program as a whole, in terms of both reducing costs and improving quality. Indeed, according to a review of the data from the Washington, D.C.-based National Association of ACOs (NAACOS), ACOs in the MSSP generated $314 million in net savings to Medicare in 2017 after accounting for bonuses paid from the government to ACOs.
NAACOS went on to note that in 2017, 472 ACOs caring for 9 million beneficiaries participated in the MSSP, generating gross savings of $1.1 billion based on the CMS methodology for setting financial benchmarks. According to 2017 CMS performance data, 60 percent of ACOs saved money in 2017 and 34 percent of ACOs earned shared savings, up from 56 percent and 31 percent, respectively, in 2016. And, in 2017, MSSP ACOs achieved a mean quality score of 90.5 percent under pay-for-performance measurement.
What’s more, the 2017 results reveal a continued trend of CMS’ ACO programs in that ACOs that are in the program longer are more likely to earn shared savings and save money overall for Medicare. Specifically, those MSSP ACOs that began in 2012 or 2013—when the program first began—generated net savings of $205 million, after factoring in bonuses paid. Those MSSP ACOs that started in 2014 generated $173 million in savings; ACOs beginning in the MSSP in 2015 generated $5 million; and MSSP ACOs that started in 2016 and 2017 lost Medicare a combined $68 million last year ($34 million each).
In Track 1 of the MSSP model, ACOs take on only one-sided risk, meaning they share in the savings they generate, but any losses fall entirely on the plate of the government. MSSP Tracks 2 and 3 involve downside risk, but participation in these tracks has been limited thus far. CMS leadership has reiterated in recent months that one-sided risk ACOs are costing Medicare money and have not been effective enough.
To this point, CMS now allows ACOs to stay in shared savings only programs for up to six years, to prepare for taking financial risk, giving ACOs time to build the infrastructure—the care coordination, information technology and data analytics capabilities—to transform practice and manage financial risk successfully.
But in a recent proposed regulation from CMS on the future of MSSP ACOs, the agency is suggesting to shorten the glide path for new ACOs to assume financial risk, reducing time in a one-sided risk model from the current six years to two years.
This proposal, coupled with CMS’s recommendations to cut potential shared savings in half—from 50 percent to 25 percent for one-sided risk ACOs—will certainly deter new entrants to the MSSP ACO program. It’s a proposal that has so far been met with mixed reaction as stakeholders weigh the broad intent of CMS to push providers into two-sided risk models.
Nonetheless, groups such as NAACOS adamantly disagree with how these ACOs have performed thus far. “These recent results show that ACOs have turned the corner and this evidence dispels confusion about ACO performance. The hard work of ACOs is paying off – for patients, providers and for the Medicare Trust Fund, and it’s essential we strengthen this program for the future,” Clif Gaus, president and CEO of NAACOS, said in a statement today.
Farzad Mostashari, former National Coordinator for Health IT and current CEO of Aledade, a Bethesda. Md.-based company that helps create and operate physician-led ACOs, tweeted out similar numbers about the 2017 MSSP ACO results, while also attesting that even the Track 1 MSSP ACOs are performing well.
Meanwhile, CMS also announced the results of the two-sided risk Next Generation ACO model earlier this week, reporting that the first cohort of Next Gen participants generated net savings to Medicare of approximately $62 million while maintaining quality of care for beneficiaries for the 2016 performance year.
During the release of the Next Gen ACO results, CMS Administrator Seema Verma again stressed her desire to move providers into two-sided risk. “What this really shows is that these Next Gen ACOs are taking the highest levels of risk and they’ve managed to maintain quality while still lowering cost,” Verma said. “Much of the savings achieved by the Next Gen ACOs were largely due to reductions in hospital spending and spending in skilled nursing facilities, and that’s very consistent with what we’ve seen with how other two-sided ACOs have achieved savings,” she added.
