Medicare Shared Savings Program ACOs saved $4.1 billion in 2020
ACOs also hit an average quality score of 97.8%, and 60 ACOs earned a perfect score of 100.
Photo: Cavan Images/Getty Images
Medicare's largest alternative payment model produced its highest annual savings to date in 2020, as shown by performance data released this week by the Centers for Medicare and Medicaid Services.
The Medicare Shared Savings Program, the accountable care organization (ACO) model that served 10.6 million seniors in 2020, collectively saved Medicare $4.1 billion last year, and $1.9 billion after accounting for shared savings payments, according to the National Association of ACOs.
Importantly, these ACOs also hit an average quality score of 97.8%, and 60 ACOs earned a perfect score of 100. This is an improvement over the $2.6 billion and $1.2 billion in gross and net savings MSSP created in 2019, making 2020 a banner year for ACOs.
WHAT'S THE IMPACT?
ACOs provide an alternative to the fee-for-service system by holding groups of doctors, hospitals and other providers accountable for the cost and quality of a defined set of patients. They earn the right to share with Medicare savings generated if certain spending and quality metrics are met.
Results for all 2020 Shared Savings Program ACOs, which compare the year's spending to preset targets, are available in an online public use data file. In 2020, 513 ACOs participated in the Shared Savings Program, in which participation is voluntary.
NAACOS attributes the drop in ACOs to several Trump-era policies, including 2018 changes CMS called "Pathways to Success," which gave ACOs limited time before taking on financial risk, and cut the share of savings most ACOs are eligible to keep.
NAACOS expressed support for the Value in Health Care Act (H.R. 4587), which would increase shared savings rates, create what it considers favorable risk adjustment and benchmarking policies, and provide at least three years before being forced to take on risk. The organization has called on Congress to include the act in the upcoming reconciliation bill.
Other results gleaned from the data include $390 in gross savings per beneficiary; earned shared savings for 345 of 513 ACOs, good for 67%; $2.3 billion in shared savings payments for ACOs; gross savings for 75% of shared savings-only ACOs and shared savings for 55%; and gross savings for 97% of at-risk ACOs shared savings for 88%.
In addition to the 2020 results, NAACOS points to multiple analyses showing ACOs are lowering Medicare spending by 1 to 2%, which translates into tens of billions of dollars of reduced Medicare spending when compounded annually.
THE LARGER TREND
When Xavier Becerra was confirmed as secretary of the U.S. Department of Health and Human Services, NAACOS recommended to Becerra that HHS should set a national goal to have a majority of traditional Medicare beneficiaries in an ACO by 2025. The agency should also deprioritize the rush to risk and build a population health infrastructure, NAACOS said.
Additionally, said NAACOS, HHS should address the overlap of competing payment models to prioritize total cost-of-care models, strengthen incentives to attract new ACOs and retain existing ones, and provide meaningful funding to build infrastructure necessary to spur innovation and value through expanded advanced payments and grants.
In 2019, 541 accountable care organizations in the MSSP generated $1.19 billion in total net savings to Medicare, the largest annual savings for the program to date, according to then-CMS Administrator Seema Verma in September 2020.
ACOs that took on downside financial risk outperformed ACOs that did not, with net savings of $152 per beneficiary compared to $107 per beneficiary, Verma said at the time.
An April 2020 survey released by the National Association of Accountable Care Organizations found that more than half of healthcare organizations taking financial risk in a Medicare program said they are at least somewhat likely to drop out because of the financial pressure resulting from the COVID-19 pandemic.
While 30% of accountable care organizations in the MSSP said it was not likely they would drop out, 21% said they were very likely to leave, and 14% said they were likely to drop out of the program. Another 21% of ACOs said they were somewhat likely to leave MSSP. Almost 80% of ACOs said they were "very concerned" about their ACO performance.
Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com
