NASL Article Details

General Announcement

OIG Releases Report on ACO Strategies for Transition to Value-Based Care

NASL, 8/14/2019

In July, the Office of the Inspector General (OIG) released a report entitled, ACOs’ Strategies for Transitioning to Value-Based Care: Lessons From the Medicare Shared Savings Program (OEI-02-15-00451). This review was conducted in light of the fact that Medicare spending is expected to exceed $1.5 trillion by 2028, which is more than double the $708 billion in spending in 2017.  In order to help control Medicare spending, while also promoting high-quality healthcare, the Centers for Medicare and Medicaid Services (CMS) has been implementing alternative payment models that reward providers for the quality and value of services furnished to Medicare beneficiaries.  This is part of CMS’ transition away from fee-for-service to value-based care.

The Medicare Shared Savings Program (Shared Savings Program) is part of this transition and is one of the largest alternative payment models that incentivize efficient and quality care.  In this program, healthcare providers voluntarily form Accountable Care Organizations (ACOs) to coordinate patient care in such a way as to reduce spending and improve quality of care.  If an ACO is successful and meets certain Medicare requirements, it is eligible to receive a portion of the savings it generates from Medicare.  In 2018, the Shared Savings Program had 561 ACOs that served 10.5 million beneficiaries.  According to the OIG, ACOs’ strategies can inform not only current and future ACOs, but also other alternative payment models in general. 

This study is a follow-up to an August 2017 OIG study, which found that most ACOs reduced their Medicare spending compared to their benchmarks in the first 3 years of the program.  From 2013-2015, the net reduction in Medicare spending was nearly $1 billion.  At the same time, ACOs improved their performance on the majority of the individual quality measures.  The OIG also found that high-performing ACOs, in particular, maintained a high use of primary care visits, reduced the use of costly services such as emergency department visits, and lowered spending by an average of $673 per beneficiary for key Medicare services.  Read NASL's full summary