According to a new Avalere study, Accountable Care Organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP) generated savings significantly lower than estimates made by the Congressional Budget Office (CBO) in 2010 when the program first launched.
The MSSP was announced by the Centers for Medicare and Medicaid Services (CMS) in 2010 as an incentive for healthcare providers to work together to improve patient care coordination. Under the Shared Savings Program, both healthcare providers and suppliers can form an ACO. In an ACO, participating organizations share responsibility for the quality, cost, and outcome of care provided to an assigned Medicare fee-for-service population.
Top 10 MSSP ACOs by Generated Savings
|ACO Name||Patient Population||Generated Savings|
|Palm Beach Accountable Care Organization (FL)||51,150||$62,751,855|
|Advocate Physician Partners Accountable Care (IN)||139,617||$60,680,999|
|Hackensack Alliance ACO (NJ)||29,546||$50,511,463|
|USMM Accountable Care Partners (MI)||17,842||$44,479,905|
|Cleveland Clinic Medicare ACO (OH)||71,113||$42,204,925|
|AMITA Health Accountable Care Organization (IL)||36,771||$42,011,535|
|Memorial Hermann Accountable Care Organization (TX)||51,337||$31,114,764|
|Orange Accountable Care of South Florida (FL)||17,747||$28,598,190|
|BHS Health System [Closed] (TX)||32,672||$27,934,433|
Fig 1 Data from Definitive Healthcare based on CMS reporting of MSSP ACO Gross Generated Savings.
Participating ACOs can choose from four different MSSP “tracks”:
- Track 1: ACOs do not take on risk for shared losses if they do not lower Medicare expenditures
- Track 1+: ACOs assume limited risk for shared losses
- Track 2: ACOs may share in savings (greater than those in Track 1) or repay Medicare losses depending on individual performance
- Track 3: May share in generated savings (greatest of any track) or repay losses to Medicare depending on performance
The majority of MSSP ACOs choose Track 1, which does not require participants to repay Medicare for spending above the target budget. From 2012 to 2018, the number of ACOs participating in the shared savings program grew from 27 to 561, exacerbating the issue of overspending without repayment to Medicare. Experts believe that rather than decreasing healthcare spending, as the MSSP was meant to, the program is actually increasing healthcare-related spending.
Avalere's study found that actual ACO net savings fell more than $2 billion short of CBO projections between 2013 and 2016. While MSSP ACOs were projected to decrease federal budget expenditures by $1.7 billion, the MSSP actually increased federal spending by more than $380 million from 2013 to 2016--a difference of over $2 billion. Though overall savings have not met initial expectations, individual ACO performance appears to be improving over time. MSSP ACOs in their fourth performance year showed net savings totaling $152 million, suggesting that participating ACOs require experience in order to produce meaningful savings.
Top ACOs by Patient Population
|ACO Name||Patient Population||ACO Type|
|TMA PracticeEdge (TX)||5,000,000||Commercial ACO|
|Texas Health Resources ACO (TX)||1,600,000||Commercial ACO|
|Aetna - Childrens Hospital of Philadelphia (CHOP) ACO (PA)||1,400,000||Commercial ACO|
|Delaware Valley ACO (PA)||1,400,000||Commercial ACO|
|Steward Integrated Care Network (MA)||1,000,000||Medicare Next Generation ACO|
|Carilion Clinic ACO (VA)||1,000,000||Commercial ACO|
|Heritage Medical Group ACO (PA)||700,000||Commercial ACO|
|Atrius Health Pioneer ACO [Closed - Left Pioneer Program] (MA)||700,000||Medicare Pioneer ACO|
|Healthcare Partners ACO (CA)||675,000||Commercial ACO|
|Riverside Health System ACO (VA)||500,000||Commercial ACO|
Fig 2 Data from Definitive Healthcare based on CMS reporting.
According to Definitive Healthcare data, the top 10 MSSP ACOs generated an average of $41.8 million dollars last year, and a total combined savings of $418.5 million.
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