Net savings from MSSP will be slow to materialize, study suggests

While early participation in the Medicare Shared Savings Program has proved to generate small but meaningful reductions in spending, actual progress for Medicare may be slow emerge, according to an analysis published in The New England Journal of Medicine.

Researchers set out to examine how much MSSP accountable care organizations truly reduced spending and whether certain types of ACOs were more successful than others. To do this, they compared changes in spending and performance on Medicare claims-based quality measures for patients served by the 220 ACOs that entered MSSP in 2012 or 2013 to changes in spending and performance for patients who received care from non-ACO providers in the same region as the ACOs.

Here are five main takeaways from the study.

1. One-sided risk contracts can effectively reduce healthcare utilization. Most ACOs in the MSSP are one-sided contracts, meaning they only share in savings and do not have to bear downside risk. Results of the study show savings for the 2012 cohort of ACOs totaled $238 million, which was considered on par with the savings of Pioneer ACOs.

2. However, due to the fact that most MSSP ACOs have one-sided risk contracts, Medicare did not generate net savings. Medicare paid $244 million in bonuses for the MSSP in 2012, but it did not benefit from penalties paid by ACOs that did not meet spending benchmarks.

3. Expanding the program may slow tangible successes for Medicare even more. According to the study, ACOs that started in 2013 were not associated with early savings, likely because organizations with less advanced systems are more likely to enter later, and these organizations will need more time to improve.

4. ACOs led by independent primary care groups generated substantially greater savings than those integrated with hospitals. The researchers wrote, "In particular, independent physician groups have stronger incentives to lower inpatient and hospital outpatient spending than groups integrated with hospitals because their shared-savings bonuses are not offset by forgone profits from reductions in hospital care." This differs from CMS' findings, which suggest savings were generally the same across ACOs, according to the study.

5. Providers with greater opportunities to cut spending will be more successful. The researchers found savings were greater for ACOs that spent more than the local averages, compared to those with already below-average spending. "This finding also confirms the importance of encouraging participation by high-spending organizations as CMS considers transitioning benchmarks for ACOs to average fee-for-service spending in their region," the researchers wrote.


More articles on accountable care:

Integra, Unitedhealthcare launch Rhode Island's first Medicaid ACO
NCQA recertified Essentia Health as level 3 ACO
MSSP market landscape and trends: 10 things to know

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