Organizations that joined the Medicare Shared Savings Program (MSSP) when it launched in 2012 achieved modest savings while maintaining or improving performance on measures of quality in patient care over the first full year of the program. The early adopters lowered spending by 1.4 percent in 2013, a reduction of $238 million, relative to a control group of providers in the same geographic areas that are not accountable care organizations (ACOs).
These findings were reported online April 13 in the New England Journal of Medicine by HMS researchers. The study’s findings give added evidence of promising early results from ACO initiatives in Medicare, but also reveal a complex story about the pattern of savings across different types and cohorts of ACOs.
Accountable care organizations are groups of health care providers that agree to provide care to a population of patients under a global budget known as a benchmark. Organizations that spend below the benchmark and perform well on quality of care measures share in the savings. Unlike with other ACO programs, MSSP participants are not required to reimburse Medicare if spending exceeds the benchmark.
While the ACOs that joined in 2012 cut spending by $238 million, the cohort of ACOs that joined in 2013 achieved no savings in their first full year in the program, suggesting that the early success of the first participants may not be replicated by the subsequent waves of ACOs that have joined the MSSP. In addition, because Medicare paid out $244 million in shared-savings bonuses to the early-adopting ACOs, that group’s lower spending did not constitute net savings to Medicare.
“Building on the initial success of ACO models in Medicare,” says J. Michael McWilliams, the Warren Alpert Associate Professor of Health Care Policy at HMS, an HMS associate professor of medicine at Brigham and Women’s Hospital, and lead author of the study, “will require stronger incentives and rigorous evaluations to identify groups of systematically successful ACOs whose organizational models and strategies can be disseminated.”