Medicare's Accountable Care Organization Initiatives Achieve Savings and High Quality Care

The Centers for Medicare & Medicaid Services (CMS) released interim financial results for the Medicare Shared Savings Program Accountable Care Organizations (ACOs) and Advance Payment ACOs, as well as preliminary evaluation results for the Pioneer ACOs and final results from the Physician Group Practice Demonstration initiatives.

According to the findings, Medicare ACOs that shared in savings under the Shared Savings Program generated shared savings totaling $128 million for the Medicare trust fund. Of the 114 ACOs that started program operations in 2012, 54 ACOs had lower expenditures than projected, and 29 will share interim savings totaling more than $126 million – a strong start this early in the program. Initial results from the independent evaluation of the Pioneer ACO Model, the ACO model designed for more experienced organizations prepared to take on greater financial risk, shows that Pioneer ACOs have saved $155 million while continuing to deliver high quality care. More than 25,000 physicians earned incentives by working with their ACO to successfully report quality measures. This positive news regarding the Medicare ACOs combined with a continuing decline in the latest Medicare hospital readmission data demonstrates that Medicare delivery system reform efforts are gaining momentum and moving in the right direction.

“These innovative programs are showing encouraging results in delivering high quality, lower cost health care, while providing valuable lessons as we strive to improve our nation’s health care delivery system,” said Health and Human Services Secretary Kathleen Sebelius.

The findings demonstrate that ACOs of various sizes and organizational structures located across the country can deliver high quality care while reducing expenditure growth.

The Medicare Shared Savings Program was created to facilitate coordination and cooperation among providers to improve the quality of care for Medicare fee-for-service beneficiaries and reduce the growth in costs. ACOs share with Medicare any savings generated from lowering the growth in health care costs while meeting standards for high quality care. Final performance year 1 results will be released later this year, but the early results are promising.

Methodist Patient Centered ACO is among the 29 ACOs that generated shared savings according to the CMS interim financial reconciliation report. “We are proud of the progress we’ve made in identifying and implementing improved methods of caring for patients and reducing costs,” said Melissa Gerdes, MD, ABFM, AAFP, assistant vice president and chief medical officer for outpatient services and ACO strategy. “While this is only a progress report, meaning Methodist has not received any shared savings payments as of yet, it certainly indicates we are moving in the right direction and we look forward to continuing the trend in anticipation of the final performance report.”

About Methodist Health System
Guided by the founding principles of life, learning, and compassion, Methodist Health System uses some of the latest medical technology and research to bring quality health care to individuals and families throughout North Texas. Methodist Dallas Medical Center, Methodist Charlton Medical Center, Methodist Mansfield Medical Center, Methodist Richardson Medical Center, Methodist Midlothian Health Center, and Methodist Family Health Centers are part of the nonprofit Methodist Health System, which is affiliated by covenant with the North Texas Conference of The United Methodist Church. Additional information is available at Connect with them through Facebook, YouTube and Twitter.

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