Study finds shared savings accountable care organizations saved less year-to-year
Also, savings were consistently greater for independent primary care groups than in hospital-integrated groups.
Accountable care organizations that participated in the first full year of Medicare Shared Savings saw early reductions in spending that eroded a year later, according to a new study published in the New England Journal of Medicine.
ACOs in the first full year of the Medicare Shared Savings Program in 2012 saw a 1.4 percent savings, or $144 per beneficiary. But in 2013, providers saved only $3 per beneficiary, the study said.
Estimated savings were consistently greater for independent primary care groups than in hospital-integrated groups during both years, said authors J. Michael McWilliams, Laura A. Hatfield, Michael E. Chernew, Bruce E. Landon and Aaron L. Schwartz.
[Also: Doctors can teach hospitals a thing or two about running an accountable care organization]
"Independent physician groups have stronger incentives to lower inpatient and hospital outpatient spending than groups integrated with hospitals because their shared-savings bonuses are not offset by forgone profits from reductions in hospital care," the authors wrote.
"Our findings suggest that financial integration between physicians and hospitals, which may increase commercial healthcare prices, is not necessary for ACO success," the authors said.
The authors did their study using Medicare claims from 2009 through 2013, comparing changes in spending and performance on quality measures from before the start of ACO contracts to after the start of the contracts.
The authors compared beneficiary results for the 220 ACOs that entered the program in mid-2012; those that entered in January 2013; and to non-ACO providers. Adjustments were made for geographic area and beneficiary characteristics.
[Also: CMS changes benchmark rules for Shared Savings ACOs, will account for regional differences]
ACO savings were compared according to organizational structure, baseline spending, and concurrent ACO contracting with commercial insurers.
MSSP contracts were associated with improved performance on some quality measures and unchanged performance on others, the study said.
Medicare Shared Savings Program ACOs have financial incentives to lower spending and improve quality.
ACOs are one of the primary tools CMS is using to shift away from the traditional fee-for-service payment model. The agency announced last month that it had already met its goal of having at least 30 percent of Medicare spending tied to alternative payment mode by the end of this year.
The study shows Medicare did not save money on the contracts. Owing to the one-sided nature of almost all Medicare Shared Savings Program contracts, the $238 million spending reduction in 2012 did not result in net savings because Medicare paid $244 million in bonuses without recouping losses from ACOs that had spending above their benchmarks, the study said.
Twitter: @SusanJMorse
