Some ACOs realize early savings

January 30, 2014

Pioneer and Shared Savings ACOs claim $274 million in payback for reducing costs

Today, the Centers for Medicare & Medicaid Services (CMS) released results for Accountable Care Organizations (ACOs), finding that Shared Savings ACOs, Pioneer ACOs and other programs combined for a total of $380 million in savings so far, including $128 million earned back to the Medicare trust funds.

“This number is far higher than what we had guessed would happen three years into the program,” said Jon Blum, Principal Deputy Administrator of Centers for Medicare & Medicaid Services (CMS), in a press call.

The Medicare ACO program began in 2012. There are now 360 organizations in Shared Savings or Pioneer tracks, covering 5.3 million beneficiaries, or 12% to 13% of the total Medicare population. Among the early adopters, 29 of the organizations in Shared Savings have earned rewards totaling $126 million.

For Pioneers, the savings they will claim totals $147 million. 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. Although some Pioneers have changed their track and opted instead for the Shared Savings model-which shares savings but not losses-no organization has dropped out of the ACO program completely, officials say.

Blum estimates about half the ACOs have physician-led models.

Bundled payments

CMS also announced that 232 acute care hospitals, skilled nursing homes, physician group practices, long-term care hospitals and home health agencies are participating in the Bundled Payments for Care Improvement initiative. Bundled services include thousands of episodes, according to officials, including heart bypass surgery and joint replacement. More than half of the organizations have moved from phase 1 and now taking on risk in phase 2 models.

Blum says the ACO and bundled payment programs are long-term initiatives that are meant to improve cost and quality over time.

 

Participants:

Bundled Payments for Care Improvement: http://innovation.cms.gov/initiatives/bundled-payments.



Medicare Shared Savings Program: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/index.html?redirect=/sharedsavingsprogram/.  

Pioneer ACOs: http://innovation.cms.gov/initiatives/Pioneer-ACO-Model/index.html.