MSSP ACOs save Medicare $2.1B in 2023, the largest savings in program history

Accountable care organizations saved Medicare $2.1 billion, the largest yearly savings in program history, in 2023, the Centers for Medicare & Medicaid Services (CMS) revealed Tuesday.

The results come from the Medicare Shared Savings Program (MSSP), which saved a net $1.8 billion in 2022, at the time the second-highest annual savings.

It is the seventh consecutive year the program generated savings.

ACOs reaped $3.1 billion in performance payments, again the highest figure since the program started 10 years ago. These organizations also scored better on certain quality measures, a news release explained.

“ACOs led by primary care clinicians had significantly higher net per capita savings than ACOs with a smaller proportion of primary care clinicians,” a news release said. “These results continue to underscore how important primary care is to the success of the Shared Savings Program.”

CMS said there were significant improvements on quality measures for diabetes and blood pressure control, breast cancer and colorectal cancer screenings, future fall risk screenings, statin therapy for prevention and cardiovascular disease treatment, and depression treatment.

ACOs are eligible to receive shared savings when an organization successfully offers quality care and reduces costs, but it also shares the losses in situations of spending mismatches.

"We have had decades of pilots, programs, payment schemes," said Aledade CEO Farzad Mostashari in a post on X. "This is literally the first time that we can say a payment model saves money while delivering higher quality care at scale, nationwide." He added that MSSP savings go further than savings generated by Medicare Advantage.

There are 480 ACOs in MSSP with more than 608,000 clinicians caring for almost 11 million people, and 453 ACOs achieved shared savings. Just 15% of ACOs report all payer measures.

“Last year, ACO participants reduced Medicare spending by an average of 4% for nearly 11 million beneficiaries, resulting in Medicare's largest savings to date—an impressive $5.2 billion, with $2.1 billion retained by Medicare and $3.1 billion distributed as shared savings,” said Aisha Pittman, the National Association of ACOs' senior vice president of government affairs, in a statement.

The top 10 performing organizations are responsible for 20% of all savings, or $631 million, said Jason Jobes, a senior vice president at Norwood, a healthcare consulting company, in a LinkedIn post.

In the proposed physician fee schedule set to be finalized soon, CMS proposed a “prepaid shared savings” option for ACOs to invest in beneficiaries through quarterly payments. At least half of savings would be required to go toward meals, transportation or other supplemental benefits.