Experts Disagree on ACOs Success for Cost-Savings and Care Quality

Whether accountable care organizations are living up to the lofty expectations of healthcare executives and federal policy makers is a matter of rising debate.

Proponents contend that the early evidence points to increased care quality. But detractors counter that ACOs have failed to produce adequate cost savings and efficiencies, according to commentaries published in the Journal of the American Medical Association.

Kevin Schulman, MD, of Duke University School of Medicine and Harvard Business School, and Barak Richman, of Duke University School of Law, said they aren't impressed with the early findings, pointing to a trio of published evaluations that suggest less-than-ideal efficiencies generated by ACOs.

The first, a comprehensive evaluation of the performance of Pioneer ACOs showed savings in the cost of care to the Centers for Medicare and Medicaid Services in 2012 of 1.2 percent. But after accounting for bonus payments, net savings to CMS were a paltry 0.4 percent, and 40 percent of the participating sites ended their involvement in the program after the first year, they said.

A second analysis by CMS showed smaller increases in total Medicare expenditures for ACO-aligned beneficiaries, but the result was substantially reduced by the second year of the program and didn't include incentive costs to ACO participants.

The third report, an evaluation of the CMS Medicare Shared Savings Program, found that the 2012 ACO cohort showed a lower cost of care but triggered CMS bonus payments that exceeded those savings. Then, the 2013 cohort didn't save money at all. Furthermore, none of those evaluations, Schulman and Richman said, considered the costs to implement the ACO.