Three-quarters of ACOs in collaborative achieve savings for Medicare

Sept. 29, 2020

Three-quarters (75 percent) of Premier Population Health Management Collaborative (PHMC) accountable care organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP) earned savings for the government, according to results released by the Centers for Medicare & Medicaid Services (CMS) last week. 

Of those, 44 percent performed well enough to qualify for shared savings payments from Medicare.

These results outpace the national averages for comparable ACOs, which generated savings and shared savings at a rate of 70 percent and 40 percent, respectively. Additionally, PHMC MSSP ACOs participating in two-sided risk generated savings at a slightly higher rate when compared to all two-sided risk ACOs nationally (90.91 percent, compared to 90.71 percent). In total, PHMC members have generated net savings of $716 million over the course of five years, almost half of which ($323.6 million) was generated in 2019 alone. 

“Achieving success in Medicare ACO models is difficult work with complex variables at play, and PHMC ACO members are consistently proving that establishing a well-planned, value-based care delivery process and model leads to success,” said Seth Edwards, Vice President of Strategy, Innovation and Population Health at Premier and the leader of the PHMC. “These results are a testament to the high-performance culture that the collaborative has helped hardwire into the DNA of these ACOs. We congratulate the PHMC members on their steadfast commitment and these impressive results. These shared savings will be critical to ongoing care redesign, particularly now that health systems are being tapped as first responders in the COVID-19 pandemic.” 

recent survey conducted by Premier found that providers participating in ACOs drew heavily on their population health capabilities to manage COVID-19 cases and prevent the spread of disease. 

“PHMC members are true heroes of the pandemic, bringing all their sophisticated resources to bear to manage health and improve their communities,” said Edwards. “Their efforts should be recognized and rewarded. It should not be harder for these systems to achieve financial success in the MSSP, and health system ACOs should be on a level playing field with physician-led ACOs.” 

Currently, physician-led ACOs are afforded more time in the Basic track and a lower overall exposure to payment risk, two significant advantages not afforded to health system ACOs. 

“The goal of ACOs is to cost effectively manage and deliver appropriate care across settings – not prevent care in any specific setting,” continued Edwards. “ACOs that are incented to focus on one provider group’s success over another’s risk recreating the perverse incentives of fee-for-service, pitting providers against one another rather than encouraging cross-continuum collaboration.” The PHMC includes approximately 450 hospitals and tens of thousands of clinicians across 80 markets working together to align, measure and improve population health. Many of these members participate in the highest risk bearing tracks within the Medicare ACO programs. Through the PHMC, leading health systems work together to share lessons learned, insights, data and best practices with each other. 

Premier has the release