MARIA CASTELLUCCI October 01, 2019
The CMS achieved
savings from the Medicare Shared Savings Program last year, marking the second
year in a row the agency turned a profit from the program.
About 66% of the
548 Medicare accountable organizations produced a total of $1.7 billion in
savings in 2018 and the CMS scored a $739.4 million gain, according to new agency data. That's significantly higher compared
to 2017 when the CMS saved $314 million from the program.
The savings were
greater as more ACOs took on downside risk compared to previous years, analysts
said.
Overall, 82.6% of
ACOs—or 453—were in Track 1, which doesn't involve downside risk. That is fewer
ACOs than 2017 when 92% of the ACOs were in Track 1.
Of the 95 ACOs in
downside risk tracks, 55% were in Track 1+, which was available for the first
time last year.
Track 1+ was
likely appealing because while it put ACOs on the hook for potential losses,
they were modest compared to the other tracks.
"It gave
them (the ACOs) that sweet spot where they can assume downside risk but in a
reasonable manner," said Allison Brennan, senior vice president of
government affairs at the National Association of ACOs.
The downside risk
ACOs were also more likely to achieve savings. Fifty-nine of the 95 downside
risk ACOs got a bonus compared to just 146 of the 453 upside only ACOs.
This shows that
the ACOs that decided to take on downside risk were confident they would do
well, said David Muhlestein, chief research officer at Leavitt Partners.
ACOs were also
motivated to join downside risk tracks because they are considered advanced
alternative payment models under MACRA, Brennan said. Clinicians are exempt from MIPS if they are in an advanced
alternative payment model and qualify for a 5% payment bonus.
"There's an
incentive to be in an advanced alternative payment model," Muhlestein
added.
Even though the
CMS achieved savings in the MSSP, it's still modest compared to overall
Medicare spending. There are about 10.1 million beneficiaries in the program,
therefore $739 million in net savings equals about $73 in savings per
beneficiary.
"It's still
a very small portion of (Medicare's) total expenses," Muhlestein said.
"MSSP is going in a good direction, it's getting better ... but it still
hasn't shown that this model will be sufficient to address our overall
healthcare spending growth concerns as a country."
Although the
savings are modest, Brennan said the MSSP is still achieving more compared to
other advanced alternative payment models.
"This is a
good program, it isn't a perfect one, but this is contributing to hundreds of
millions of dollars in savings in a given year and we have to make a dent
somewhere," she said.
The savings the
program will achieve this year are uncertain considering significant changes to the program went into effect
this July. The CMS overhauled the program in December to address concerns that
it was costing Medicare money as ACOs remained risk averse. ACOs will now be
forced into risk quicker.
The program saw a drop in participants as a result of the changes
but Muhlestein said those that stuck in the program are likely confident they
can handle the impending downside risk and will still achieve savings for
Medicare although they will continue to be modest because the CMS still has to
hand out bonuses.
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