Dive Brief:
Medicare’s largest value-based care program saved the government more than $2.1 billion last year — an all-time record, according to the CMS.
Accountable care organizations, groups of providers that join together to manage the care of a patient population, also benefited, receiving performance payments of $3.1 billion in 2023. That’s also a historic high since the Medicare Shared Savings Program was formed more than one decade ago.
The quality of ACOs is also rising, the CMS said. Regulators specifically called out improvement in measures related to diabetes and blood pressure control, statin therapy for cardiovascular diseases and screening for depression, fall risk and breast and colorectal cancers.
Dive Insight:
The Medicare Shared Savings Program, or MSSP, is the largest ACO program in Medicare with almost 11 million beneficiaries covered by 480 ACOs.
Participating ACOs receive a portion of the savings they generate compared to a benchmark, while ACOs with spending exceeding the benchmark might have to pay a penalty. The goal is to improve outcomes and lower healthcare costs by incentivizing providers to better manage patient care.
The CMS on Tuesday lauded seven straight years of savings in MSSP. Under the Biden administration, the agency has gone all-in on accountable care — its goal is to bring all 34 million beneficiaries in traditional Medicare into value-based arrangements by 2030.
Last year, 453 of the 480 ACOs participating in MSSP achieved total savings of $5.2 billion, according to the CMS. Medicare retained $2.1 billion while another $3.1 billion was divvied out in shared savings. In comparison, in 2022 Medicare saved $1.8 billion while ACOs earned $2.5 billion.
Last year, Citrus ACO in Central West Florida had the highest shared savings rate of 19.44%, while
Health Connect Partners — the MSSP ACO operated by nonprofit hospital giant Providence — had the highest net savings of $137 million, according to CMS data.
AnewCare Collaborative in east Tennessee had the worst shared savings rate of -6.91%, while Northwestern Medicine Physician Network ACO in Chicago had the steepest losses, at $19 million.
ACOs led by primary care clinicians had higher savings than other ACOs, the CMS said. The finding is important in light of a shift toward hospital-owned ACOs, which earn more revenue when patients are admitted, giving them less of an incentive to reduce pricey hospital care, according to congressional scorekeepers.
Despite continued savings, MSSP has had an uncertain budgetary impact on the CMS over its tenure. The program was associated with net losses of between $775 million and $2.1 billion from 2013 to 2021, according to research in JAMA Health Forum.
The CMS has also had difficulty prodding providers to join MSSP. Participation has trended down over the past several years, after peaking in 2018 with 561 ACOs.
Regulators recently revamped MSSP in a bid to revitalize provider interest, adding benefits like up-front payments to certain providers and making changes to promote more risk-sharing. In a Medicare payment rule expected to be finalized this week, the CMS also proposed prepaying ACOs a portion of shared savings each quarter to encourage them to invest in staffing and infrastructure.
