Toward Accountable Payment

Where the Medicare ACOs are, 2014 edition

by Rob Lazerow

On Thursday, CMS released the first results from the Medicare Shared Savings Program (MSSP), announcing the performance of the 114 organizations that joined the program in 2012.

Nearly half of the 2012 ACOs—54 out of 114—successfully reduced spending for attributed beneficiaries below their expenditure target. However, only 29 of the ACOs generated enough savings to qualify for shared savings bonuses. These top-performing ACOs earned $126 million in shared savings payments. Overall, the 2012 ACOs generated $128 million in net savings for CMS.

Mixed performance results no surprise

The initial results from the MSSP reinforce a key reality for providers: building an effective population health enterprise is a complex and time-intensive process.

New ACOs may have to tackle a number of foundational steps before demonstrating savings or earning bonuses, such as engaging physician partners, improving referral pathways, deploying IT and analytic systems, and developing new care management models.

But overall, I’m encouraged to see that nearly 50% of the 2012 ACOs beat their spending benchmarks; to me, this is a more important early result than the number of ACOs that received bonuses.

Hitting that spending benchmark signals the feasibility of population health, while missing the bonus payment may just point to how the MSSP program was designed. CMS can continue to tweak the shared savings model to reward providers for successfully reducing cost and improving quality.

123 new ACOs join MSSP

Beyond sharing initial performance results, CMS noted the continued growth of provider participation in the MSSP. At the start of the year, 123 new organizations joined the program, bringing the total count of Medicare ACOs up to 366, including both MSSP and Pioneer ACO Model participants.


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Meet the Author

Rob LazerowRob Lazerow
Practice Manager
Health Care Advisory Board