Number of ACOs on the rise, but growing at slower pace

Even as numerous providers drop out of Medicare's Pioneer Accountable Care Organization (ACO) program, the overall number of ACOs increased in 2014 at a slightly slower pace than the previous year, according to an analysis from consulting firm Oliver Wyman.

Nearly 7 in 10 Americans now live in an area served by an ACO, according to the analysis, and 44 percent live in areas served by at least two. That's an increase from last year, when the firm found two-thirds of Americans had ACO access. Overall, there are 426 Medicare ACOs as of January 2015, an increase of 58 from last January. However, this represents slower growth than the previous year, when ACOs increased by 234. In addition to the Medicare ACOs, the report identified 159 other types of ACOs that add up to 585 total, a 12 percent increase from 2014.

About 5.6 million Medicare patients, or 11 percent, will receive their healthcare from an ACO. While ACOs increased by about 16 percent, the number of patients receiving care from them only increased 6 percent, which the report attributes to smaller ACOs joining the Medicare program.

"The slowdown we're seeing in the growth of ACOs was almost inevitable, given the pace of change of the past two years," Oliver Wyman partner Niyum Gandhi said in a statement. "I expect the next advance will be characterized more by increased sophistication than by increased numbers."

Recent changes to the ACO model the Centers for Medicare & Medicaid Services has proposed, such as the Next Generation ACO model, could help ACOs compete at a more aggressive level, Gandhi said. Healthcare experts have praised the Next Generation model, under which providers assume more risk for potentially larger rewards, as a way of speeding the transition to value-based care.

To learn more:
- read the report (.pdf)
- here's the statement

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