blue chart with a huge bright arrow in the middle increasing

Two years of financial performance data are revealing the frontrunners of the Medicare Shared Savings Program (MSSP). Less than 40 of the 300 participating accountable care organizations have earned shared savings in consecutive years, and it is not immediately clear why these 40 were so successful at controlling expenditures. A plausible explanation is that providers in successful MSSP ACOs also participate in other programs, such as medical homes, bundled payments, or even other ACOs that offer an opportunity to gain population health management expertise that can be leveraged to provide more efficient care.

Other value-focused programs, as it turns out, are common among providers in financially-successful ACOs. Among MSSP ACOs earning savings in both years, more than half included at least one physician practice recognized by the National Committee for Quality Assurance as a patient-centered medical home. Participation in the Bundled Payments for Care Improvement Initiative, which was designed to prepare providers to take on financial risk for episodes of care, and other ACOs are less common. But a number of the successful MSSP ACOs are driven by integrated delivery networks.

The finding of common medical home participation is significant because physicians must demonstrate competency in population health management to earn recognition for their practice. It makes sense, then, that an ACO with primary-care practices recognized as medical homes would have an easier job of coordinating patient care. On the flip side, less-successful ACOs may be at a disadvantage because they have not developed their care coordination infrastructure and experience to the same extent as a recognized medical home. Similarly, bundled payments can provide experience with taking on financial risk, which is vital in an environment where value-based contracts are becoming more common. In addition, participation in multiple ACO contracts by a group of providers reflects a commitment to population health management—often across different patient populations. Serving a greater proportion of patients that are under ACO contracts also requires a high degree of buy-in to the objectives associated with those ACOs, or else providers risk losing millions in shared savings.

The structure of integrated delivery networks is likely another contributor to ACO success. IDNs consist of tightly integrated providers that commonly include value-focused elements such as care coordination initiatives, a shared technology platform, and shared clinical guidelines. Memorial Hermann Health System, based in Houston, is a prime example. The health system has pursued clinical integration initiatives for years and operates NCQA-recognized medical homes and two ACO contracts with commercial payers in addition to its MSSP ACO. Memorial Hermann earned more than $100 million in shared savings over the span of two years. Having a network of population health-focused providers with the capability to share information and coordinate care should position an ACO for success.

There are also other factors influencing ACO performance. For example, some organizations that are experienced at controlling costs made care coordination improvements before they began to participate, leaving little room for growth and making shared savings more difficult to earn. Dartmouth-Hitchcock and Sharp Healthcare are both drop-outs from Medicare’s Pioneer ACO program, which targeted organizations with care coordination experience for participation, because of difficulties in reducing expenditure amounts that were already lean.

Even though financial variables can be misleading as a marker of ACO achievement, a look at the small subset of high-achieving MSSP ACOs may begin to reveal provider characteristics related to ACO success.

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