Higher Ratio of ACOs Report Savings During 2014

Expectations were high that accountable care organizations (ACOs) could generate significant savings to Medicare, and the latest report from CMS(www.cms.gov) on their 2014 performance illustrates gradual but continued savings.

The 20 ACOs in the Pioneer Model and 333 ACOs in the Medicare Shared Shavings Program generated more than $411 million in total savings in 2014. Pioneer participants saved $120 million in 2014, compared with $96 million in 2013. Among ACOs in the Shared Savings Program, 92 participants held spending $806 million below budget targets and received $341 million in shared savings payments.

A total of 97 ACOs qualified for shared savings payments of $422 million when they met quality standards and a savings target.

ACOs that have been operating longer are showing improved performance over time. The percentage of ACOs that achieved savings increased from 25 percent in 2013 to 37 percent in 2014.

With two full years of ACO performance now recorded, participants in the Medicare Shared Savings Program have saved Medicare $848 million, according to David Klebonis, chief operating officer of the Palm Beach ACO -- one reason the agency is eager to keep the initiative going.