Medicare ACOs produce value-based savings for sixth year in a row

For the sixth year in a row, the accountable care organizations (ACOs) of the Medicare Shared Savings Program (MSSP) have produced measurable savings for Medicare. CMS recently announced that in 2022, the program achieved its second-highest annual haul since it launched ten years ago, saving $1.8 billion compared to program targets in 2022. 

“This program has delivered more than $1.8 billion in savings and delivered high-quality health care to millions of people,” said HHS Secretary Xavier Becerra. “The Biden-Harris Administration will continue to do everything we can to strengthen Medicare and ensure everyone can access high-quality, affordable health care.” 

As of the beginning of January 2023, there are 456 ACOs comprising more than 573,000 providers participating in the MSSP serving close to 11 million Medicare beneficiaries. An additional 132 participants are part of the complementary ACO REACH program, which serves an additional 2 million Medicare members. 

The combined 13 million beneficiary total brings CMS about one-third of the way to its goal of having all traditional Medicare beneficiaries enrolled in some sort of accountable care arrangement by 2030.   

MSSP results by the numbers

Sixty-three percent of participating ACOs achieved shared savings in 2022, CMS said. Low-revenue ACOs, often led by primary care providers or smaller rural hospitals, were more likely to earn savings than high-revenue ACOs anchored by larger hospitals or health systems. 

Low-revenue ACOs achieved an average of $228 per capita in net savings compared to their larger peers, which only produced $140 per capita next savings. Low-revenue ACOs with the highest proportions of primary care providers (75% or more) were even more likely to lead the pack by achieving $294 per capita in net savings – more than twice the average of ACOs that include larger healthcare organizations.  

In general, ACOs had a higher average performance on key clinical quality measures compared to providers not participating in the value-based care program. Results include higher performance on measures related to diabetes and blood pressure control, breast and colorectal cancer screenings, tobacco screening, and depression screening and follow-up. 

Tilting toward two-sided risk arrangements

The majority of MSSP ACOs are now in two-sided risk arrangements, with 67% of ACOs accepting the notion that they may be liable to return money to Medicare if they miss their quality and spending targets, according to the National Association of ACOs (NAACOS). 

The ACO REACH program, which focuses strongly on health equity and coordination of care, is even more heavily weighted toward risk-taking. More than 80% of ACO REACH participants have selected the most ambitious Global risk track, which provides a single capitated payment for all covered services, including specialty care. 

“The Medicare Shared Savings Program helps millions of people with Medicare experience coordinated health care while also reducing costs for the Medicare program,” said CMS Administrator Chiquita Brooks-LaSure. “CMS will continue to improve the program, and it is exciting to see that Accountable Care Organizations are continuing to be successful in delivering coordinated, high-quality, affordable, equitable, person-centered care.”

Continuous improvement to expand and refine the environment of ACOs

CMS has remained steadfastly committed to the MSSP over the past decade, and is continuing to work on the program to make it simpler and more attractive to join the accountable care community.   

In 2022 and 2023, CMS has proposed or finalized a number of changes designed to increase health equity, encourage enrollment among providers in rural and underserved areas, streamline reporting requirements, and better align the MSSP with other quality reporting programs, such as MIPS.   

One major adjustment is the ability to assign more beneficiaries to ACOs even if they receive the majority of their care from nurse practitioners, physician assistants, and clinical nurse specialists instead of physicians. This change recognizes the diversification of care teams in light of physician shortages and evolving care models. 

CMS is also offering more time to transition to downside risk, a health equity adjustment for providers serving socioeconomically vulnerable populations, and advance investment payments to certain ACOs in rural and underserved communities to reduce the start-up burdens of bringing a practice into the value-based care ecosystem.   

“We are encouraged and inspired by six consecutive years of savings and high-quality care, with 2022 being one of the strongest years of performance to date,” said Meena Seshamani, MD, PhD, CMS Deputy Administrator and Director of the Center for Medicare. “The Shared Savings Program is Medicare’s permanent, flagship Accountable Care Program, and we look forward to continually improving and growing the program, expanding the reach of participating ACOs, and addressing critical health disparities across the country.” 

Jennifer Bresnick is a journalist and freelance content creator with a decade of experience in the health IT industry.  Her work has focused on leveraging innovative technology tools to create value, improve health equity, and achieve the promises of the learning health system.  She can be reached at jennifer@inklesscreative.com.