On December 22, 2014, The Centers for Medicare and Medicaid Services was excited to announce that 89 new Accountable Care Organizations (ACOs) will be joining the Medicare Shared Savings Program (MSSP). A total of 424 ACOs will be participating in the Shared Savings Program next year, serving more than 7.2 million beneficiaries.
ACOs are one part of CMS’s vision for improving the coordination and integration of care received by Medicare beneficiaries. ACOs are groups of doctors, hospitals, and other health care providers that work together to give Medicare beneficiaries in Original Medicare (fee-for-service) high quality, coordinated care. ACOs can share in any savings they generate for Medicare, if they meet specified quality targets.
In 2014, existing Shared Savings Program ACOs added almost 17,000 healthcare providers, and the 89 new ACOs will bring approximately 23,000 additional physicians and other providers into the ACO program starting January 1, 2015. The growth of this program for providing health care has been continued and consistent since its inception, and CMS is exhilarated by that interest.
Since ACOs first began, Shared Savings Program ACOs improved on 30 of the 33 quality measures, including patients’ ratings of clinicians’ communication, beneficiaries’ rating of their doctors, and screening for high blood pressure. CMS is also seeing promising results on cost savings with combined total program savings of $417 million for the Shared Savings Program and the Pioneer ACO Model.
ACOs are also just one way that CMS is working to reduce the rate of growth in Medicare spending while improving care. Medicare spending per beneficiary was essentially flat in nominal dollars in fiscal year 2014, and from 2010 to 2014, Medicare spending per beneficiary grew. ACOs drive progress in the way care is provided by improving the coordination and integration of health care, and improving the health of patients with a priority placed on prevention and wellness. Ultimately, the program is delivering better care, spending dollars more wisely, and having healthier people and communities.
The verdict is still out, however, on whether the program will have staying power. While the initial savings estimates look large, they are small per participant. Many ACOs invested millions to participate. As the pilot closes out over the next few years, many ACOs may determine that the experiment was worthwhile but choose to enter the Medicare Advantage program proper. There, if quality scores can be achieved, there may be a much greater financial upside for the same or fewer regulatory burdens.