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September 17, 2014

How to understand the latest ACO results

Daily Briefing

CMS just released its latest findings on hospitals participating in Medicare's various ACOs. What are the key takeaways? Tom Cassels, the Health Care Advisory Board's executive director, walks through the new data in a conversation with the Daily Briefing's Dan Diamond.

Q: Did these results meet your expectations, or surprise you?

Tom Cassels: My expectations are simple: Participants in the Pioneer and Medicare Shared Savings Program will use [those] programs to prime the market for more desirable provider-led Medicare Advantage products.

The Pioneers’ improved performance on beneficiary experience of care meets my expectations because they are focused on winning trust and engagement with their practices.

Meanwhile, the relatively strong-performing MSSP programs continue to be those that are built upon Clinical Integration networks that have spent time “shrinking to reliability”—ensuring that high performing physicians and practices are celebrated and low performing participating practices drop out.

Both of these results tell me that the ACOs with clarity of strategic purpose are winning, regardless of the absolute value of their earned bonuses.

Q: How heartened should we be that ACOs generally improved quality performance? Or to put it another way, how concerned should we be about the middling success against financial goals?

Cassels: I’m conflicted.

On quality, I’m eager for the table stakes to be raised. We are measuring improvement off of what we can measure today. Quality is far too narrowly and imprecisely defined today and as we move forward winning ACOs should be rewarded for reliably better results on access, patient safety, experience of care, and other full spectrum measures of quality.

When it comes to bending the cost curve, I’m not going to sneeze at holding [the] trend 0.5 percentage points below growth in Medicare fee-for-service.

The challenge is that the financial return to providers to achieve these savings is not viable. 

Q: And that gets to my next question. Ten of 32 Pioneers have dropped out. Providers are pushing back against the MSSP ACO rules. What needs to change for this program to be viable in the long run?

Cassels: I’m not sure that viability of the ACO program should be the goal at CMS. The real goals are supporting clinically integrated provider organizations that beneficiaries choose to manage their health and health care.

“The acid test for me is not whether the ACO program survives.”

So in the long run, the acid test for me is not whether the ACO program survives, but whether the momentum that it is creating for providers to organize and act differently will continue. And whether that momentum extends to how beneficiaries think about their health security, opting to choose provider partners over passive purchasing in traditional fee-for-service.

Get the big picture: The field guide to Medicare payment innovation


The Affordable Care Act brought many types of changes to hospital payments.

This infographic presents an overview and assessment of the major Medicare programs accelerating the transition to population health, including the Shared Savings Program and Pioneer ACO Model.


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