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ACOs Show Uneven Progress

Greg Freeman, April 7, 2014

Just over half of the 114 organizations to join one of two Medicare accountable care organization efforts in 2012 report no decrease in health spending below targets during their first 12 months.

This article appears in the April 2014 issue of Managed Care Contracting & Reimbursement Advisor.

The first numbers for Medicare's biggest accountable care experiment under the Affordable Care Act show mixed results for improving quality and reducing costs.

Just over half of the 114 organizations to join one of two Medicare accountable care organization (ACO) efforts in 2012 report no decrease in health spending below targets during their first 12 months trying to do so, according to newly released CMS data. Another 29 reduced spending enough during the first 12 months to keep some of the savings.

The results are in line with Medicare's smaller test of accountable care. In the CMS Innovation Center's Pioneer ACO model, also launched in 2012, nine of the 32 organizations left the program after its first year, and nine of the remaining 23 organizations saved money.

The recent report reveals that Medicare ACOs that shared in savings under the Medicare Shared Savings Program (MSSP) generated savings totaling $128 million for the Medicare trust fund. Of the 114 ACOs that started program operations in 2012, 54 ACOs had lower expenditures than projected, and 29 will share interim savings totaling more than $126 million.

Initial results from the independent evaluation of the Pioneer ACO model, designed for more experienced organizations prepared to take on greater financial risk, shows that Pioneer ACOs have saved $155 million while continuing to deliver high-quality care.

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