Mixed news for first year of Medicare Shared Savings Program

It's been a bumpy road for Medicare Accountable Care Organizations, with only 97 of 353 Pioneer and Medicare Shared Savings Program ACOs earning performance bonuses in 2014, and new data show the MSSP achieved mixed results its first year, according to research published in the New England Journal of Medicine.

The research found the ACOs that joined the program in 2012 cut spending by $238 million, but the second group of ACOs, which joined the program in early 2013, generated hardly any savings, with an average of only $3 less per beneficiary. Researchers further found that the $244 million in bonuses paid out to the first two groups essentially wiped out any Medicare savings generated by the first group's lower spending.

"These results suggest that ACOs with no downside risk can achieve savings, but that savings to Medicare and society may be slow to develop," lead author J. Michael McWilliams, M.D., Ph.D., associate professor of healthcare policy at Harvard Medical School said in a statement. "But the incentives for ACOs to lower spending are currently very weak, so savings may accelerate if the incentives are strengthened."

A closer look by the researchers found that independent primary care groups had higher savings within the ACO cohorts than hospital-integrated groups, which they speculated may be due to stronger incentives for the independent primary care docs to reduced inpatient and outpatient spending. They further determined savings were higher for MSSP ACOs with relatively high spending for their geographical region, indicating that it was easier to cut spending for providers with more opportunities to do so.  

To learn more:
- read the study abstract
- check out the statement