Physician-led ACOs saw savings in Medicare program

10 Sep 2018 | SOURCE: Healthcare Dive



Dive Brief:

  • Physician groups participating in the Medicare Shared Savings Program (MSSP) produced savings after three years in the program, while hospital-integrated accountable care organizations didn’t see that level of cost-cutting, according to a new study in the New England Journal of Medicine.
  • The researchers found that physician-led ACOs enjoyed more savings the longer they were in the program. The mean per-patient Medicare savings was $474 for physician groups in their third year in MSSP. Those savings are compared to $342 for those in the second year and $156 after their first year.
  • Hospital-integrated ACOs, meanwhile, saw a $169 per-patient savings for those in the third year, $18 savings in the second year and $88 savings in the first year.

Dive Insight:

The large savings for physician-led ACOs is a departure from a 2017 evaluation of the MSSP program. That report showed just one-third of ACOs in the program achieved savings, though they outperformed their FFS counterparts on most quality measures.

The new study also comes after CMS released new data that found the MSSP saved Medicare $314 million after bonuses paid to ACOs in 2017. Also, the Patient-Centered Primary Care Collaborative’s 2018 Evidence Report in August found that Medicare ACOs with primary care physicians who have patient-centered medical home experience are more likely to save money and show higher quality scores. All of these studies are a win for physician-led practices.

Despite the recent successes, CMS may soon look to make some changes to the MSSP. Agency officials recently suggested an MSSP overhaul to get the ACOs to take on financial risk faster. However, Center for Medicaid and Medicare Innovation Director Adam Boehler said last week that CMS won’t force providers into risk-based contracting.

The study authors, who are from Harvard Medical School, Brigham and Women’s Hospital and Beth Israel Deaconess Medical Center, used fee-for-service Medicare claims from 2009 to 2015 to compare changes in Medicare spending for patients in the ACOs before and after they entered the MSSP.

Before taking into account bonus payments, the study found that by 2015, MSSP providers reduced total Medicare spending by beneficiary by $302 compared to 2012.

The study, which was funded by the National Institute on Aging, said physician-group ACOs created net savings to Medicare of $256.4 million in 2015. The study authors said providers in the MSSP have incentives to lower spending and achieve high quality.

“ACOs that are physician groups have stronger incentives to lower spending than hospital-integrated ACOs,” they wrote.

The study found that physician-group ACOs saw reduced spending on acute inpatient care, post-acute care, home healthcare initiated on an outpatient basis and outpatient care in hospital-owned settings. Emergency department visits also declined, while there wasn’t a significant difference in primary care visits, hospitalizations for ambulatory care-sensitive conditions or 30-day readmission rates.

For hospital-integrated ACOs, there wasn’t a significant difference in spending. There were also small increases in readmissions and minor decreases in ED visits, according to the report.

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