CMS: Medicare & Medicaid ACOs are Saving Money

The Centers for Medicare and Medicaid Services says its Medicare and Pioneer accountable care organization initiatives have saved more than $380 million. However, participants doing well are a distinct minority.


The Centers for Medicare and Medicaid Services says its Medicare and Pioneer accountable care organization initiatives have saved more than $380 million. However, participants doing well are a distinct minority.

In the first 12 months of the Medicare Shared Savings Program, 54 of 114 ACOs had lower expenditures than anticipated. Twenty-nine of the 54 ACOs generated shared savings of more than $126 million while generating $128 million in net savings to Medicare Trust Funds, based on interim results, with final results expected later in 2014. Interim results are currently within the range projected for the first year, according to CMS.

In the Pioneer ACO program designed for organizations with higher capacity to assume financial risk, nine of the 23 participants had “significantly lower spending growth relative to Medicare fee-for-service while exceeding quality reporting requirements,” CMS says. Pioneer ACO gross savings totaled $147 million in the first year.

In the Physician Group Practice Demonstration program that pays incentives for generating Medicare savings while improving care, seven of the 10 practices earned shared savings payments while reducing costs by $108 million over five years, according to CMS.

Further, 232 providers, covering acute care hospitals, physician practices, skilled nursing homes, long-term care hospitals and home health agencies, have agreed to participate in the Bundled Payments for Care Improvement program. CMS says the initiative is the largest of its kind by Medicare or any other insurer in the nation.

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