Accountable care organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP) in 2016 generated a total of $652 million in gross savings, according to CMS data released Friday.
MSSP ACO Performance
MSSP enables ACOs to receive bonus payments if they maintain high-quality care while decreasing Medicare spending compared with their individual benchmark.
The CMS data show that an estimated 134—or about 31 percent—of the 432 ACOs that participated in MSSP for the program's fifth performance year generated shared savings in 2016. According to Healthcare Finances News, 294 of the 432 MSSP ACOs generated neither savings nor losses in 2016, while four generated losses. For the 134 organizations that earned a distribution, CMS distributed $701 million in bonus payments.
The 10 MSSP ACOs that generated the highest shared savings in 2016 were:
- Advocate Physician Partners Accountable Care, which generated $28,924,272 in shared savings;
- AMITA Health ACO, which generated $20,489,157 in shared savings;
- Cleveland Clinic Medicare ACO, which generated $19,914,592 in shared savings;
- Hackensack Alliance ACO, which generated $22,835,022 in shared savings;
- Memorial Hermann ACO, which generated $14,025,212 in shared savings;
- Millennium ACO, which generated $18,530,680 in shared savings;
- Orange Accountable Care of South Florida, which generated $13,033,788 in shared savings;
- Palm Beach ACO, which generated $30,540,508 in shared savings;
- USMM Accountable Care Partners, which generated $21,195,787 in shared savings; and
- UT Southwestern Accountable Care Network, which generated $17,464,034 in shared savings.
In contrast, the CMS data show that, in 2016:
- Catholic Medical Partners ACO generated $2 million in shared losses;
- MedStar Accountable Care generated $3.6 million in shared losses;
- Oregon ACO generated $1.3 million in shared losses; and
- Torrance Memorial Integrated Physicians generated $1.7 million in shared losses.
According to the data, MSSP ACOs that have participated in the program since 2012 and 2013 accounted for more than $500 million in gross savings, while ACOs that entered MSSP in:
- 2014 accounted about $94 million in gross savings;
- 2015 accounted for about $50 million in gross savings; and
- 2016 accounted for about $6 million in gross savings.
CMS data show about 77 percent—or 330—of the 428 MSSP ACOs subject to pay-for-performance measures for the 2016 reporting period achieved an average quality score of 94 percent. The remaining 98 MSSP ACOs, which were in pay-for-reporting status, earned quality scores of 100.
Clif Gaus, president and CEO of the National Association of ACOs (NAACOS), in a statement said, "These results show the growing success of ACOs, which is a positive trend that should not be ignored." He added, "A lot has been accomplished in a relatively short amount of time and ACOs are on the front line of redesigning health care delivery" Morse, Healthcare Finance News, 10/30; Stankiewicz, Bloomberg BNA, 10/25; Haefner, Becker's Hospital Review, 10/30; Gregory, HealthExec, 10/30).
Advisory Board's take: The 5 key takeaways you need to know from this year's MSSP results
Hunter Sinclair, Vice President
CMS typically releases Medicare Shared Savings Program results accompanied by a press release praising organizations for their hard work. But this year's results were easy to overlook because CMS released them without fanfare last Friday.
The headline number is that the MSSP netted Medicare $652 million in savings (before distributions), but lost money if you factor in the $691 million in net distributions.
Based on my review of the 2016 results, a few things stick out:
- Savings payments are (still) far from guaranteed: In line with prior years, only 31 percent of organizations generated significant enough savings to earn a distribution (although 55.8 percent had expenditures lower than their benchmark, which is an improvement).
- Experience matters: Only 18 percent of the organizations that joined the MSSP in 2016 earned shared savings, compared with 42.5 percent of those that started in 2012.
- Risk is a motivating factor: 68 percent of organizations in Track 2 or 3 (models with downside risk) earned shared savings, compared with 29 percent in Track 1's upside-only model. It's also worth noting that both organizations that jumped into Track 3 without prior experience had million dollar losses. For more information on how to evaluate whether taking on risk is the right move for your organization, read our study on navigating the future of risk-based payment.
- Post-acute care is critical to earning shared savings: Organizations that earned a distribution reduced overall expenditures by 3.5 percent on average, but their Skilled Nursing Facility (SNF) spending fell by 18.3 percent on average and their Home Health spending fell by 9.7 percent. They were able to reduce days spent in SNFs by 21.5 percent—much greater than their 3.8 percent reduction in ED visits
- The program is at a crossroads: These results are for the program's final year before MACRA takes effect, and you should expect a dramatic increase in the number of organizations switching to the Next Generation ACO program or the new Track 1+ model in 2018. CMS did a great job designing Track 1+ as a more attractive model for organizations wanting to take on downside risk while mitigating their exposure to losses. This trend will only accelerate next year, when 127 organizations that have been in Track 1 since 2013 will be forced to take on downside risk if they want to stay in the program. I've heard from many of these organizations that they are proactively transitioning to Track 1+, but many more will have a difficult conversation next summer if they haven't earned shared savings in five years and are forced to take on downside risk or leave the program.