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The Medicare Shared Savings Program Final Rule: What You Need to Know

Posted by Matthew Smith on Jun 8, 2015 1:59:00 PM

On December 1, 2014, the Centers for Medicare and Medicaid Services (“CMS”) published proposed changes to the Medicare Shared Savings Program (“MSSP”) regulations, with the final rule being announced on June 4, 2015. While the timing of the release of the final rule isn’t optimal for those that may have considered participating in the upcoming round of entrants, the final rule further clarifies CMS’ intent to facilitate the movement to value-based payment methodologies. Many of the changes were adopted as proposed, while some others were altered from the proposed changes. Here are highlights of some key changes in the final rule and what it means to accountable care organizations (“ACOs”).

Extending the Time Period for Participation in Track 1

Previously, Track 1 ACOs (no downside risk) were limited to one three-year agreement period before converting to a risk-based track. The final rule allows participants to remain in Track 1 for an additional 3-year performance period, or a maximum of two three year periods without the reduced sharing rate that CMS had proposed. This proposal allows those ACOs who have seen modest improvements in their ACO operations and performance and/or those who are not ready for performance-based risk a little more time to implement and execute.

Assignment of Beneficiaries

The assignment of beneficiaries was historically a two-step process based on provision of primary care services by 1) Primary Care Physicians and 2) Specialists and Advanced Care Practitioners (“ACPs”) (e.g., nurse practitioners, physician assistants and clinical nurse specialists). The final rule revises the process to include ACPs in Step 1 and removes specialties which are unlikely to provide primary care services. This proposal effectively moves the beneficiary assignment toward the provision of primary care and allows the specialists who want to participate in multiple ACOs the flexibility to do so. Further, through rulemaking in the 2017 Physician Fee Schedule, CMS expects to propose that beneficiaries may attest that their main doctor is participating in a performance-based risk track ACO and be assigned to that ACO. Assignment methodology and fluctuations have been a pain point for many ACOs.  While this may not be a cure, it does work to address many of the concerns.

Sharing of Data

CMS previously shared certain claims data with ACOs only after ACOs had 1) notified their beneficiaries of that data sharing via direct mail or at the time of service and 2) provided them an opportunity to opt out of data sharing. This time-consuming process was onerous for the ACO and its providers and delayed the receipt and review of data which is key to the success of the ACO. It was also confusing for beneficiaries who received letters in the mail and at the point of care. The final rule allows ACO providers to post signs in their facilities with template notification language that will notify beneficiaries of their right to opt out by calling CMS directly. The proposal removes the ACO from the data sharing consent process – a win for current ACOs who have found the beneficiary notification process to be exceedingly burdensome and a distraction from the primary work of population health management.

Revisiting the Methodology for Establishing, Updating, and Resetting the Financial Benchmark

The current methodology based on the ACO’s past performance that CMS uses for setting, updating, and resetting the ACO’s financial benchmark is flawed. It gives increased opportunity to those ACOs with high utilization and costs and inadvertently penalizes those that have already moved to improve quality and manage costs. Additionally, the method gives diminishing returns over time as ACOs succeed in achieving savings year over year. Once the cost curve has reset, there will be little to no savings left to share. CMS sought comment on alternative ways of benchmarking ACOs for shared savings, including options of comparing ACO providers to the spending patterns of non-ACO providers within their region. In the final rule, CMS formalized the process to equally weight the historical benchmark years, as opposed to weighting those years 10% for benchmark year (“BY”) 1, 30 percent for BY2, and 60 percent for BY3 at the start of the second or subsequent agreement period; and indicated intent to commence rulemaking later this year to implement a methodology that would reset ACO benchmarks in part based on trends in regional fee-for-service costs rather than solely on an ACOs’ own recent spending. The consideration of a revised method that can better reflect the underlying health of the population to reset the benchmark is encouraging. A more precise and accurate reflection of the health of the assigned population will further improve patient experience and enhance the value of the care provided while achieving savings for CMS.

Incentivizing ACOs to Move Toward Risk-Based Models

CMS has finalized the creation of a new Track 3, a performance risk-based model, which will have a higher sharing rate than Tracks 1 or 2 at 75 percent of all savings or losses and would offer prospective assignment of beneficiaries rather than preliminary assignment with retrospective reconciliation. Additionally, CMS modified Track 2 to allow ACOs to choose from a selection of options for setting their minimum savings rate (“MSR”) and minimum loss rate (“MLR”) in an equilateral manner, with either no MSR/MLR, equilateral MSR/MLR in .5 percent intervals between .5 and 2 percent or equilateral MSR/MLR to vary based on the number of assigned beneficiaries as in Track 1. In the final rule, the new Track 3 will follow the same methodology as Track 2.

CMS also indicated its intent to further test the billing and payment requirements for telehealth services via its newly created Next Generation ACO model. It is anticipated that a telehealth waiver may be available to ACOs in the Track 3 model by January 1, 2017.

Additional refinements include minor changes to the eligibility for participation in the MSSP, including removal of the requirement that the ACO’s medical director be an ACO provider/supplier; and a more streamlined process for Pioneer ACOs to apply for program participation, among others.

While it remains to be seen if the proposed changes will encourage more provider organizations to join the MSSP, it is clear that CMS is creating various models to fit the needs of different types of organizations. Determining which model is appropriate considering the unique characteristics of your organization will be key to success.

Table. 1. MSSP Final Rule Changes and Characteristics of MSSP Tracks 1-3

(Note: Click here for a PDF download of the table or here for an image file.)

MSSP_Final_Rule-1.png

Source: The Centers for Medicare and Medicaid Services, 2015

Topics: ACO, MSSP, Medicare Shared Savings Program, Accountable Care Organizations, MSSP ACO, MSSP Final Rule

Mishka Glaser, Managing Associate, Joins the Health Directions Team

Posted by Matthew Smith on Nov 18, 2014 11:02:00 AM

Mishka Glaser, Health Directions, Managing AssociateHealth Directions is pleased to announce the addition of Mishka Glaser, CISA, Managing Associate, to the Health Directions team. As a key strategist in the Population Health Management Solutions Group, Mishka leads the implementation of clinical integration, accountable care and other innovation strategies for the firm’s clients. 

"Mishka's wealth of strategic insight and experience in the field of population health brings an exciting new dimension to our Population Health practice area," says Daniel J. Marino, Health Directions President/CEO. "Her in-depth knowledge of value-based care operations provides the context for assisting our clients in navigating their population health journey."

Mishka brings over 15 years of experience in various sectors of healthcare—from physician practices to insurance and pharmaceuticals. Her past positions include IT Audit Manager at Sparrow Health System, Project Manager for a Statewide HIE project at Michigan Public Health Institute, Project Manager at Roche Pharmaceuticals, Territory Sales Representative with Aventis Pharmaceuticals, Program Manager Life Operations and Process Improvement at Blue Shield of California.

Prior to joining Health Directions, Mishka served as the Director of Implementation Services for Collaborative Health Systems in Houston, Texas, working with over 30 Medicare Shared Savings Program Accountable Care Organizations across the US. 

She holds memberships in the Health Information Management Systems Society (HIMSS) where she is serving a two-year term as a member of the Quality, Cost, and Safety Committee; the Information Systems Audit and Control Association (ISACA); and the Healthcare Financial Management Association (HFMA).

Mishka earned a Bachelor of Science in Business Administration (Accounting Information Systems) from Central Michigan University and a Masters of Diplomacy and International Relations (Global Health and Foreign Policy) from Seton Hall University.  

Please join us in welcoming Mishka to the Health Directions team!

To download a PDF version of Mishka's latest article, MSSP Year 1 Results – New Surprises or Business as Usual? please click on the button below (no form required).

MSSP, Accountable Care, Population Health

Topics: ACO, MSSP, Medicare Shared Savings Program, Mishka Glaser, Accountable Care Organizations

ACO Survey Findings and Comments on Quality Benchmark Rule

Posted by Matthew Smith on Nov 17, 2014 6:02:00 PM

ACO News, Accountable Care Organization, CMSThe National Association of ACOs (NAACOS) announced new results to its ACO Tracking Survey. Their report provides updates to the likelihood of ACOs staying in the Medicare Shared Saving Program and the ongoing operational costs of ACOs. The results from the October 2014 survey show that two out of three (66%) MSSP ACOs are highly unlikely or somewhat unlikely to remain in the ACO Program. An additional 26% are undecided. This resulted in only 8% of ACOs being likely to sign a second contract and 92% either unlikely or undecided.

NAACOS President, Clif Gaus, commented "This continues to be the most troubling aspect of the Medicare Shared Savings Program and must be sufficiently addressed in the upcoming CMS proposed rules or the MSSP will no longer exist and the high hopes of DC policy-makers to migrate ACOs to capitation and two-sided risk will be impossible."

NAACOS continues to be concerned about the significant investment ACOs are making to sustain their operations. They define those management costs to include, administration, data, compliance, and care coordination costs among others that would not otherwise have been incurred. These did not include costs prior to the operation of their first or current performance year. ACO respondents reported an annual mean of $1.5 million management costs directly attributable to ACO operations. A previous survey included a higher percent of first year ACOs and that estimate was $2.0 million. When operating costs for the two and half years of the MSSP are totaled, Medicare ACOs have spent over $900 million for care coordination and other operational costs.

CMS Final ACO Quality Benchmarks

On October 31st, CMS finalized changes to the Medicare Shared Savings Program (MSSP) quality measures and benchmarks. While the National Association of ACOs is pleased CMS responded to several ACO provider concerns, the NAACOS believes that changing 25% of the measures is too disruptive and costly for the ACOs and do little to better inform the consumer. Further, while CMS will modestly take into account year-over-year increase in each quality measure, the quality measurement system in total will exclusively reduce the savings earned by the ACOs and provide no positive reward for improving the quality of healthcare to Medicare beneficiaries. Instead of a system of rewards and penalties, CMS has chosen to apply the "stick" only approach to ACOs. If the first year of ACO quality measures had counted in calculating Performance Year 1 savings, not one of the 52 ACOs earning shared savings would have retained all of their savings and the total savings going to the ACOs would have been reduced by 25%.  In sum, NAACOS believes CMS failed to strike an adequate balance between changes to the MSSP measure set itself and reforms the agency is making to performance benchmarking.

NAACOS President Clif Gaus said, "While CMS has made modest improvement to the ACO Quality Benchmarking, it is still a punitive program that will only lead to future reductions in savings paid to the ACOs who have worked hard to achieve those savings. Coupled with the many attribution and financial benchmarking defects, the Medicare Shared Savings Program is not sustainable in its current configuration and will decelerate the pathway to accountable care for Medicare Beneficiaries."

For additional information on the Survey results, please access the NAACOS Member Newsletter at https://www.naacos.com/pdf/Newsletter110314.pdf.

SOURCE: National Association of ACOs

Topics: ACO, MSSP, Accountable Care Organization, Medicare Shared Savings Program, ACO Models, Accountable Care Organizations, ACO Participation

MSSP Year 1 Results – New Surprises or Business as Usual?

Posted by Matthew Smith on Oct 28, 2014 3:01:00 PM
By Mishka Glaser
Managing Associate, Health Directions

Shared Savings, MSSP, ACOWhile a fair amount of bashing and fear mongering have occurred with the release of the MSSP Year 1 Results, there are other important factors to consider.

The results should come as no surprise to those who have been around healthcare for a while. There are two main reasons for this statement:

  1. Change is uncomfortable. The healthcare industry and the landscape/structures for successful change are just beginning to form.
  2. Change is not a regular occurrence in the industry nor is it filled with early adopters/risk takers. For example, today there are dozens of articles discussing how EHRs should be put out to pasture because they are difficult to use, a waste of time, and—as many pointed out after the first U.S. Ebola case—detrimental to patient care.  EHRs (and the data they are capable of providing to support sound decisions) are key components to the changes that must be made. 

At the heart of the Medicare Shared Savings Program is a fundamental change in the way healthcare is conducted and measured. Make no mistake; there aren’t any tried and true recipes for success; however there are some key indicators that are emerging. Two of these are care coordination and analysis of clinical and claims data to understand the entire population and also drill down to understand the individual patient. 

Without these, the MSSP ACOs in particular, will be hard-pressed to reach shared savings. Certainly some of them can have early wins based upon their experience with other risk programs because they are a small, close knit group who have great relationships with local hospitals, etc. However, the key to taking the next step to continue to find savings will be analytics and care coordination.   

Much to the dismay of some organizations, this isn’t an exercise where money is handed out for doing nothing. This program was built to incentivize the changes that are needed to move toward value-based care and population health and, frankly, as a learning center. The first-year performance exemplifies this point.  

  • About a quarter (25%) of the 2012 and 2013 ACOs were successful at generating and earning savings from which about 40% of those were ACOs launched in 2013. 
  • As CMS announced in their fact sheet, “this year, the ACOs improved significantly for almost all of the quality and patient experience measures.” (source)
  • Also, “organizations showed improvements in 28 of the 33 quality measures.” (source)

Ultimately, as an industry, we need to learn to measure success from a different angle. While financial windfalls are certainly at the top of the list of how to measure success, when dealing with the large scale changes that are needed to right this ship, there are many other factors that must be utilized to understand success. Much has been learned along the way, and there is much more to learn. 

All healthcare silos are still learning how and what to measure for quality, how that relates to “performance,” how to best utilize and connect the data points, etc. All of the HIT push from the past 10 years has set the stage for the incremental wins that are now occurring. It is now up to all of us to continue connecting the dots and helping retrain and retool the way healthcare is viewed and is conducted. 

 

Mishka Glaser, Health Directions, ACO, MSSPAs a member of the Health Directions Population Health Management Solutions Group, Mishka leads the implementation of clinical integration, accountable care and other innovation strategies for the firm’s clients. Her in-depth knowledge of value-based care operations provides the context for assisting clients in navigating the population health journey. Prior to joining Health Directions, Mishka served as the Director of Implementation Services for Collaborative Health Systems in Houston, Texas, working with over 30 Medicare Shared Savings Program Accountable Care Organizations across the US. Mishka may be reached by email at mglaser@healthdirections.com.
 
MSSP, ACO, Health Directions, Accountable Care

Topics: ACO, MSSP, Medicare Shared Savings Program, Mishka Glaser, Accountable Care Organizations

CMS Proposes Changes For ACOs in 2015; Including Quality Benchmarks

Posted by Matthew Smith on Jul 7, 2014 11:56:00 AM

ACO, Accountable Care Organization, MSSP, Quality MeasuresA new CMS proposal would increase the number of quality measures that accountable care organizations (ACOs) would have to achieve under the Medicare Shared Savings Program (MSSP) in 2015. The changes, which are included in the Medicare physician fee schedule released Thursday, July 3, would introduce 4 additional quality performance benchmarks. ACOs receive bonus payments based on the number of quality targets they meet. The measures would place a greater emphasis on patient outcomes. If adopted in the final rule, the changes would go into effect January 1, 2015.

Specifically, the number of quality measures used to assess ACOs would increase from 33 to 37. ACOs would need to meet the quality performance goals to earn bonus payments under the program. The new measures would include:

  • Whether patients say providers informed them about treatment costs;
  • The rate of patients who are admitted to skilled nursing facilities within 30 days of being discharged from a hospital; and
  • Unplanned readmissions for patients with diabetes, heart failure or more than one chronic condition for any reason.

The proposal to reduce the reporting burden on ACOs and move toward electronic submission of measures is generally seen as a step in the right direction. CMS said it would continue to seek comments over the proposed changes. Officials seek input on future quality measures for care coordination, health outcomes, nursing home quality, prevention, elderly public health, and utilization.  

In addition, CMS proposed:

  • Replacing a measure dealing with medication management;
  • Changing a requirement that ACOs adopt electronic health records; and
  • Eliminating some measures dealing with treatments for coronary artery disease, diabetes and ischemic vascular disease.

According to Modern Healthcare, the changes would bring the measures in line with those used in clinical practices and help simplify reporting.

Also in the proposal, CMS suggested adding new quality incentives for ACOs. The incentives would:

  • Require ACOs to meet certain quality targets while reducing health care spending in order to receive bonus payments; and
  • Allow ACOs to receive awards based on annual quality improvement.

The number of ACO participants, which presently includes 350 organizations, is also expected to increase throughout next year.

MSSP, Medicare Shared Savings Program, ACO, Accountable Care 

Topics: Accountable Care, ACO, MSSP, Accountable Care Organization, Medicare Shared Savings Program

Deadline Nears for 2015 MSSP ACO Participation

Posted by Matthew Smith on May 8, 2014 11:55:00 AM

ACO, MSSP, Deadline, Health DirectionsAs the opportunity for the 2015 MSSP ACO participation draws near, CI leader must decide, at the very least, if they intend to apply. The deadline for submitting the “notice of intent” (NOI) is May 30, 2014.

Even if organizations are remotely considering moving forward with the MSSP, they will want to submit the NOI even if they decide later not to submit the formal MSSP application. Below are the important dates related to the 2015 MSSP ACO application process.

If you have not already downloaded the Health Directions Overview of the Medicare Shared Savings Program (MSSP), please consider doing so. The file may be requested via the button, below:

MSSP, Medicare Shared Savings Program, ACO, Accountable Care

MSSP, ACO, Accountable Care Organization

Gap Analysis

There are many things to consider as CI organizations decide whether or not they should participate in the MSSP. A thorough ACO gap analysis will help CI leaders and their providers make the best decision possible while understanding their opportunities and risks. For CI organizations that decide to participate, such an assessment could be just the spark they need to launch their clinical integration program to new heights. 

One common challenge for newly formed clinically integrated networks (CINs) is to determine when it is appropriate to move into a tangible value-based program. The MSSP ACO, while not perfect, does provide a low-risk option for CINs to begin participating in population health management and the value-based reimbursement world.

Pros of Participation

The MSSP allows a CIN to begin to manage the care of a defined population and to implement tangible pieces of value based care. Since the MSSP requirements have defined criteria around the quality measures, provider participation and incentive distribution, CINs can more quickly advance their initiatives which will position them well for future contracts.

The physician participants will also receive a benefit by being associated with management of a defined population, incorporating quality initiatives within their practices and potentially realizing additional income

Cons of Participation

Although the requirements of the MSSP are not very restrictive, it is important that certain MSSP criteria exist within the provider participation agreement (PPA) and are executable by the CIN. Since many PPAs are written to be very general, reference must be made to certain MSSP criteria--such as provider participation, incentive distribution and provider remediation for non-compliance.

CINs may have a challenge in capturing the data required to support quality indicators. Since the first year of the MSSP is a “pay to report” year, CINs have a little more time to ensure they are making improvements in cost and quality. The biggest challenge is to aggregate the data from all participating providers’ systems (assuming the network is not on a single electronic health record).

Evaluating the Opportunity

It is important for CIN leaders to evaluate a number of factors to determine whether they wish to apply for the MSSP. One helpful activity is to perform an MSSP ACO Gap Analysis comparing the CI organization to the MSSP criteria. A gap analysis should not only include comparisons to the criteria, but should identify the requirements for the “Notice of Intent” to apply,  MSSP Application and a detailed plan that helps CI leaders understand how to “close the gaps."

Health Directions’ MSSP ACO assessment program evaluates the criteria and also reviews the IT requirements versus the CI capabilities including a detailed review around the ACO measure numerators, denominators and exclusions. When conducted appropriately, the MSSP ACO Gap Assessment helps leaders understand:

  • Where they may be deficient versus the MSSP criteria;
  • What is required to close the gap; and
  • How to proceed with a strategy in mind.

Topics: Accountable Care, ACO, MSSP, Accountable Care Organization, Medicare Shared Savings Program

2015 MSSP ACO: To Play or Not to Play

Posted by Matthew Smith on Apr 21, 2014 3:53:00 PM

ACO, Accountable Care Organizations, MSSPOne common challenge for newly formed clinically integrated networks (CINs) is to determine when it is appropriate to move into a tangible value-based program. The MSSP ACO, while not perfect, does provide a low-risk option for CINs to begin participating in population health management and the value-based reimbursement world.

Pros of Participation

The MSSP allows a CIN to begin to manage the care of a defined population and to implement tangible pieces of value based care. Since the MSSP requirements have defined criteria around the quality measures, provider participation and incentive distribution, CINs can more quickly advance their initiatives which will position them well for future contracts.

The physician participants will also receive a benefit by being associated with management of a defined population, incorporating quality initiatives within their practices and potentially realizing additional income

Cons of Participation

Although the requirements of the MSSP are not very restrictive, it is important that certain MSSP criteria exist within the provider participation agreement (PPA) and are executable by the CIN. Since many PPAs are written to be very general, reference must be made to certain MSSP criteria--such as provider participation, incentive distribution and provider remediation for non-compliance.

CINs may have a challenge in capturing the data required to support quality indicators. Since the first year of the MSSP is a “pay to report” year, CINs have a little more time to ensure they are making improvements in cost and quality. The biggest challenge is to aggregate the data from all participating providers’ systems (assuming the network is not on a single electronic health record).

Evaluating the Opportunity

It is important for CIN leaders to evaluate a number of factors to determine whether they wish to apply for the MSSP. One helpful activity is to perform an MSSP ACO Gap Analysis comparing the CI organization to the MSSP criteria. A gap analysis should not only include comparisons to the criteria, but should identify the requirements for the “Notice of Intent” to apply,  MSSP Application and a detailed plan that helps CI leaders understand how to “close the gaps."

Health Directions’ MSSP ACO assessment program evaluates the criteria and also reviews the IT requirements versus the CI capabilities including a detailed review around the ACO measure numerators, denominators and exclusions. When conducted appropriately, the MSSP ACO Gap Assessment helps leaders understand:

  • Where they may be deficient versus the MSSP criteria;
  • What is required to close the gap; and
  • How to proceed with a strategy in mind.

If you have not already downloaded the Health Directions Overview of the Medicare Shared Savings Program (MSSP), please consider doing so. The file may be requested via the button, below:

MSSP, Medicare Shared Savings Program, ACO, Accountable Care

Moving Forward

Since the opportunity for the 2015 MSSP ACO participation is drawing near, CI leader have to decide, at the very least, if they intend to apply. The deadline for submitting the “notice of intent” (NOI) is May 30, 2014. Even if organizations are remotely considering moving forward with the MSSP, they will want to submit the NOI even if they decide later not to submit the formal MSSP application. Below are the important dates related to the 2015 MSSP ACO application process.

MSSP, ACO, Accountable Care Organization

There are many things to consider as CI organizations decide whether or not they should participate in the MSSP. A thorough ACO gap analysis will help CI leaders and their providers make the best decision possible while understanding their opportunities and risks. For CI organizations that decide to participate, such an assessment could be just the spark they need to launch their clinical integration program to new heights. 

Topics: Accountable Care, ACO, MSSP, Accountable Care Organization, Medicare Shared Savings Program

New Download: An Overview of the Medicare Shared Savings Program

Posted by Matthew Smith on Apr 9, 2014 3:09:00 PM

MSSP, Medicare Shared Savings Program, Health DirectionWith the Medicare Shared Savings Program (MSSP) Notice of Intent to Apply submission period rapidly approaching, we've put together a concise download of essential information that ACOs need to know in order to begin the submission process.

Health Directions works with ACOs to prepare them for the MSSP application process and its requirements to complete a set of questions in the areas of population health management, care coordination, governance and technology. The Notice of Intent to Apply submission period runs from May 1, 2014-May 30, 2014. 

This new presentation from Health Directions will help readers learn more about the MSSP application process, including information about:

  • ACO Definitions
  • Types of ACO Models
  • Dilineation of Responsibilities
  • Structural Requirements of ACO Eligibility
  • Program Fundamentals
  • Participant Practice Agreements
  • MSSP Timelines

To request this new download, please click on the button, below.

MSSP, Medicare Shared Savings Program, ACO, Accountable Care

Topics: Accountable Care, ACO, MSSP, Accountable Care Organization, Medicare Shared Savings Program

CMS Reiterates: ACOs Designed for Multi-Year Savings

Posted by Matthew Smith on Feb 6, 2014 10:46:00 AM

ACO, Accountable Care Organizations, Last Thursday, January 30, the Centers for Medicare & Medicaid Services (CMS) released findings on a number of its initiatives to reform the health care delivery system. These included interim financial results for select Medicare Accountable Care Organization (ACO) initiatives, an in-depth savings analysis for Pioneer ACOs, results from the Physician Group Practice demonstration, and expanded participation in the Bundled Payments for Care Improvement Initiative.  Savings from both the Medicare ACOs and Pioneer ACOs exceeded $380 million.

Encouraged By Results

“These innovative programs are showing encouraging initial results, while providing valuable lessons as we strive to improve our nation’s health care delivery system,” HHS Secretary Kathleen Sebelius said. “These findings demonstrate that organizations of various sizes and structures across the country are working with their physicians and engaging with patients to better coordinate and deliver high quality care while reducing expenditure growth.”

While ACOs are designed to achieve savings over several years, not always on an annual basis, the interim financial results released for the Medicare Shared Savings Program ACOs show that, in their first 12 months, nearly half (54 out of 114) of the ACOs that started program operations in 2012 already had lower expenditures than projected. Of the 54 ACOs that exceeded their benchmarks in the first 12 months, 29 generated shared savings totaling more than $126 million – a strong start this early in the program. In addition, these ACOs generated a total of $128 million in net savings for the Medicare Trust Funds. ACOs share with Medicare any savings generated from lowering the growth in health care costs while meeting standards for high quality care.  Final performance year-one results will be released later this year.   

Opportunities for Learning

While evaluation of the program’s overall impact is ongoing, the interim results are currently within the range originally projected for the program’s first year.  A great majority of the program’s overall net impact was projected to phase-in over the program’s ensuing performance years.  Moreover, through regular webinars; tools for sharing information and best practices; opportunities for ACOs to connect with one another; and other activities, ACOs are being provided the infrastructure and resources to learn from one another and to then diffuse what’s working and what is not.

“Our experience has shown that ACOs can increase quality while lowering costs. As a result of the programs we’ve initiated, our patients have experienced better access to their primary care physician, higher quality measures, and fewer trips to the hospital,” said Dr. Kenneth W. Wilkins, president of Coastal Carolina Health Care.   “We look forward to making continued progress and seeing future results, and we are grateful to CMS whose advance funding made these initiatives possible.” 

“We are delighted to be participating in the Shared Savings Program because of its goal to reduce costs while simultaneously increasing the quality of care and services we provide to our patients and community,” said Dr. John B. Chessare, president and chief executive officer of the Greater Baltimore Medical Center (GBMC) HealthCare system. “The Shared Savings Program is a tangible reminder of the historic transformation taking place in our health care system and we are pleased to be a part of it.”

Pioneer ACOs Lower Spending; Boost Quality

An independent preliminary evaluation of the Pioneer ACO Model - the ACO model designed for more experienced organizations prepared to take on greater financial risk –also released last Thursday, shows Pioneer ACOs generated gross savings of $147 million in their first year while continuing to deliver high quality care.  Results showed that of the 23 Pioneer ACOs, nine had significantly lower spending growth relative to Medicare fee for service while exceeding quality reporting requirements. These savings far exceed findings from a previous analysis conducted by CMS, which used a different methodology. 

“We are still early on in the program, but are encouraged by these results and are on track to meet our goals for participation in the Pioneer Accountable Care Organization Model”, said Dr. Barbara Walters, executive medical director for accountable care, with the Dartmouth-Hitchcock ACO.  “Our strategies of using patient outreach and education and regular follow up for targeted chronic disease programs are allowing us to anticipate patient needs before their health problems become worse.  Involvement in the Pioneer Model is helping us provide better treatment for our patients across a wide-range of health challenges.”

Clinical Integration, Health Directions, Collaboration

Topics: ACO, Medicare Shared Savings Program, Medicare, CMS, Accountable Care Organizations

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