One of my favorite former CMS people, Travis Broome, recently shared a link to the ACO Savings and payment report. It provides an interesting view into the year 1 results of the Medicare Shared Savings Program (Medicare ACO program if you prefer).
It’s interesting to see which ACOs and other organizations got paid, but probably even more interesting to see ones that didn’t get paid at all. My guess is that many of them dropped out. If I’m reading the report properly, I could only find one organization that incurred a loss. It seems that Dean Clinic and St. Mary’s Hospital ACO in Wisconsin owes $3.96 million. Looks like they took the high risk-high reward option and lost. I’d love to talk to someone from that organization and hear what happened.
Travis Broome offered a number of other insights into the ACO report:
7 ACOs that had shared savings in the interim Jan 2014 release did not get shared savings in yesterday's final
— Travis Broome (@Travis_Broome) September 17, 2014
ACOs Apr starters 8 out of 25 created 126M in savings Jul starters 24/78 created 378M in savings Jan starters 21/102 created 147M in savings
— Travis Broome (@Travis_Broome) September 17, 2014
11 ACOs did not successfully report CQMS. 4 had savings leaving a total of $21.79M in shared savings on the table
— Travis Broome (@Travis_Broome) September 17, 2014
What do you think of the ACO program? I think it’s a bad sign that so many organizations fell out of the program. However, the trend and move towards this reimbursement is going to happen. I really don’t see how it could stop.
We believe Pay for Performance in one shape or form is here to stay.
Why many of them did not show savings? Many of the Hospital sponsored ACOs did not achieve any savings. And that was expected; as in any business – Hospital and ACO – have their own set of conflicts of interest. While efficiency of resource utilization is a key element for an ACO along with Patient Centered Care and Care Coordination, it is and will run counter to the financial goals of Hospitals.
Other ACOs that have not showed savings – it might take time; in our experience of working with ACOs – they are slowly but surely getting to understand the value of data, analytics and systems. Data made available by CMS is substantial and needs infrastructure and systems to interpret the data for care coordination. Its a process for the Physician led organizations to understand the need for such systems. And the ability to function as an organization. Most of the smaller practices now have to adapt to the Collaborative Model of working; although all of them have the same independence and continue to operate independently, they have to get together at regular intervals for their Board Meetings, General Body Meetings, Committee meetings and so on. This change in culture is also taking its own time; I am sure over time these nuances will be worked out and most likely they will be able to perform splendidly. It might happen in the second year when they have streamlined their best practices,, understand data better, and leverage data to provide efficient, Patient Centric care.
$200+ million is a good start and it can only get better as we move forward.