Medicare ACOs Generate More than $411 Million in Savings

Doctor with MoneyThe Centers for Medicare and Medicaid Services issued 2014 quality and financial performance results that show Medicare ACOs continue to improve the quality of care for beneficiaries – while generating financial savings.

“These results show that accountable care organizations as a group are on the path towards transforming how care is provided," said CMS Acting Administrator Andy Slavitt. “Many of these ACOs are demonstrating that they can deliver a higher level of coordinated care that leads to healthier people and smarter spending.”

ACOs are judged on their performance on an array of meaningful metrics that assess the care they provide – including how highly patients rated their doctor, how well clinicians communicated, whether they screened for high blood pressure and tobacco use and cessation, and their use of Electronic Health Records.  In the third performance year, Pioneer ACOs showed improvements in 28 of 33 quality measures and experienced average improvements of 3.6% across all quality measures. Shared Savings Program ACOs that reported quality measures in 2013 and 2014 improved on 27 of 33 quality measures.

When an ACO demonstrates that it has achieved high-quality care and effectively reducing spending of health care dollars above specified thresholds, it is able to share in the savings generated for Medicare. In 2014, 20 Pioneer and 333 Shared Savings Program ACOs generated more than $411 million in savings, which includes all ACOs savings and losses. The results show that ACOs with more experience in the program tend to perform better over time.

More than 420 Medicare ACOs have been established since the passing of the Affordable Care Act. And as of January 1, 2015, more than 7.8 million Americans are served by those ACOs. CMS expects this number to continue to grow.

To read the full press release from CMS, click here.