ACOs Save Big, Salient ACOs Save Bigger

On September 14, 2020, CMS released financial and quality performance results for Performance Year 2019 and 2019A for the Medicare Shared Savings Program. For champions of value-based care, the information gained from these results could not have been any better. Of the 541 ACOs in the Program, 241 of them generated shared savings totaling $1.19 Billion. To date, that is the largest annual savings for the program – resulting in lower post-acute spending, hospitalizations, and emergency department visits.

Broken down by beneficiary, Pathways to Success participants showed a net savings of $169 per beneficiary, and Legacy Track ACOs showed a savings of $106 per beneficiary. Some ACOs have been hesitant to take on downside risk, however, the ACOs that did take downside risk generated more savings than the ACOs that chose not to ($152 vs. $107). Not all ACOs that took downside risk ended up generating savings. Out of the 87 ACOs that took downside risk, just 6 generated losses, but those losses totaled $47,7770,704

Stepping back to look at the big picture, you can see that most ACOs, and especially the ones who are more experienced in population health, did much better last year. It would appear CMS’s initiatives for Pathways to Success appear to be starting to work. When you consider that only 11.2 million fee-for-service Medicare beneficiaries are served by ACOs, you see the opportunity for even more savings is out there as these ACOs continue to grow. There’s also immense opportunity to improve quality of care as these ACOs continue to grow and improve because the average quality score across all programs ranged from 92.17-99.66.

Salient Healthcare is proud to have played a part in helping Accountable Care Organizations succeed. The average ACO in the MSSP program generated $3.9 Million in shared savings, however, Salient clients generated an average of $6.4 Million in shared savings—nearly double! As organizations continue to embark in value-based contracts, they continue to learn. I have little doubt that we will continue to see improvements in both cost and quality for our patients. Enthusiasm aside, it is also important to note that before your organizations takes on downside risk, I highly recommend that you review your data to ensure that you are ready to do so. Shared savings is not a guarantee, and there are ACOs that lost money as a result of taking downside risk before they were ready. The best way to ensure you are practicing good population health is properly managing your population using data analytics. Consider monitoring your performance using the Salient Healthcare Solution – our Key Performance Indicators and expertise in the industry has led to significant success for our clients. We believe in what we do, and this year’s numbers prove we’re doing the right thing.

Congratulations to all ACOs that generated shared savings in 2019, and we hope to see even more shared savings and higher quality scores in 2020! 

RESOURCES

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/news

Maria Nikol

About the Author


Senior Business Consultant

Maria Nikol is a senior business consultant with 10 years of experience in healthcare operations and healthcare strategy. Her specialization includes process improvement and the application of emerging models of healthcare delivery such as Patient-Centered Medical Homes and Accountable Care Organizations. She holds a Master of Jurisprudence in Health Law from Widener University and a Bachelor of Science in Pharmaceutical Marketing and Management from the University of the Sciences in Philadelphia.

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