The Centers for Medicare & Medicaid Services (CMS) said this is the fifth consecutive year the program has generated overall savings and high-quality performance results.

The Medicare Shared Savings Program, through its work with accountable care organizations (ACOs), saved Medicare $1.66 billion in 2021, CMS announced.

Shared Savings Program ACOs are groups of doctors, hospitals, and other health care providers, who collaborate voluntarily to give coordinated high-quality care to people with Medicare and ensure that patients receive the right care at the right time, while avoiding unnecessary duplication of services and preventing medical errors. When an ACO succeeds in delivering high-quality care and spending health care dollars more wisely, the ACO may be eligible to share in the savings it achieves for the Medicare program. If an ACO doesn’t meet certain quality metrics or if it increases costs, it may owe a portion of losses.

CMS said that over the past decade, the Shared Savings Program has grown to one of the largest value-based purchasing programs in the country. As of January 2022, Shared Savings Programs include more than 525,000 participating clinicians who provide care to more than 11 million people with Medicare. Based on the program’s success and opportunities to continually improve value for people with Medicare and the health care system, CMS has set a goal that 100 percent of people with traditional Medicare will be part of an accountable care relationship by 2030.

“We are encouraged and inspired by five consecutive years of savings and quality improvement,” said Meena Seshamani, M.D., Ph.D., CMS deputy administrator and director of the Center for Medicare, in the announcement. “Learnings from the Shared Savings Program can and should be applied across the industry, driving higher quality care systemwide. CMS looks forward to continually improving the program, expanding the reach of participating ACOs, and addressing critical health disparities across the country.”

Nearly all ACOs–99 percent–reported and met the quality standard required to share in savings under the Shared Savings Program. ACOs had higher mean performance on quality measures compared to other clinician groups not in the program. This includes higher performance for quality measures related to diabetes and blood pressure control; breast cancer and colorectal cancer, and falls risk screening rates; flu vaccination; tobacco screening and smoking cessation; statin therapy for the treatment and prevention of cardiovascular disease. ACOs also had better performance on depression screening and depression remission rates, underscoring how this type of coordinated, whole-person care can improve treatment of behavioral health conditions in ACOs, in helping to achieve the goal of strengthening behavioral health quality in CMS’ Behavioral Health Strategy.

Approximately 58 percent of participating ACOs earned payments for their performance in 2021. Those with the greatest net savings were low-revenue ACOs, which were made up of physicians, included a small hospital, or served rural areas:

  • Low-revenue ACOS saw an average of $237 per capita in net savings compared to high-revenue ACOS, which had $124 per capita net savings
  • ACOs comprised of 75 percent of primary care clinicians or more realized $281 per capita in net savings compared to ACOs with fewer primary care clinicians, which had $149 per capita in net savings

These results underscore how important primary care is to the success of the Shared Savings Program and demonstrate how the program supports primary care providers, CMS said.

To help expand the Medicare Shared Savings Program, CMS has proposed major changes in the 2023 Physician Fee Schedule proposed rule. The changes would promote participation among health care providers, especially in rural and underserved areas, to improve access to ACOs for more people with Medicare. CMS wants to incorporate advance payments to certain new ACOs in rural and underserved communities that could be used to address social needs, one of the first times traditional Medicare payments would be permitted for such uses.

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CMS also proposed that smaller ACOs have more time to transition to downside risk, and a health equity adjustment to an ACO’s quality performance score that would reward excellent care delivered to underserved communities. In addition, CMS is proposing benchmark adjustments to encourage more ACOs to join the program and to maintain participation amongst current ACOs. If finalized, these changes would represent some of the most significant reforms since the program was established in 2011. Public comments on the CY 2023 Physician Fee Schedule are due by September 6.