Not perfect, but practice makes progress for ACOs

#5in5_Blog_BannerRecently released results of the Medicare Shared Savings Program (MSSP) highlight the fact that Accountable Care Organizations need to be in it for the long haul.

In August, the Centers for Medicare & Medicaid Services issued an update announcing that participating ACOs continue to show improvements in their ability to contain costs.

Three hundred and ninety-two MSSP participants generated $429 million in savings in 2015.
Only 119 performed well enough to share in savings. But a larger portion than ever before generated savings above their minimum savings rate (MSR). It’s up to 31 percent from 28 percent in 2014 and 26 percent in 2013.

One important takeaway from the results is that the longer an ACO is in the program the better chance it has of generating savings.

Of the ACOs that joined MSSP in 2012, 42 percent generated savings above their MSR. That’s compared to 37 percent of those who started in 2013, 22 percent of 2014 starters, and 21 percent of 2015 starters.untitled

This shows that getting savings in the first year might not always be achievable. But if an ACO can stick around and continue to improve quality and reduce costs, it should turn into shared savings.

These results overall are heartening and point toward the continued growth and success of MSSP.

Even more encouraging is a recently announced change to the way savings will be calculated. It should impact participation in the program in a good way.

To learn more about the rule change and how it could affect new and renewing MSSP participants, click here to download a #5in5 podcast.

About the Author:

Aaron Jurgaitis, ASA, MAAA, is an Associate Actuarial Director in the Health Care Analytics practice within Optum. He has more than 15 years of actuarial experience in both the insurance and consulting industries. He works with multiple MSSP ACOs on management-level reporting, evaluating and reporting on clinical intervention, and forecasting shared savings. Jurgaitis received his Bachelor of Science degree in Statistics from Brigham Young University. He is an associate of the Society of Actuaries and a member of the American Academy of Actuaries.

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