ACOs Taking Risk in Innovative Payment Model Generate Savings for Patients and Taxpayers
On August 27, CMS released an evaluation report for the first performance year of the Innovation Center’s Next Generation Accountable Care Organization (ACO) Model showing promising early results. Results demonstrated the positive outcomes in terms of quality and costs when providers are responsible for managing to a budget. For the 2016 performance year, the Next Generation ACO Model generated net savings to Medicare of approximately $62 million while maintaining quality of care for beneficiaries. As part of its recent “Pathways to Success” proposal, CMS proposed taking many principles from the Next Generation ACO Model and adopting them more broadly for ACOs in the Medicare Shared Savings Program.
“These results provide further evidence that ACOs succeed under two-sided risk,” said CMS Administrator Seema Verma. “ACOs in the Next Generation Model are being held accountable with strong financial incentives and are provided with substantial flexibility and regulatory relief. They are delivering value and providing quality care to patients and taxpayers even in their first performance year, and we believe that these results are achievable for other ACOs under similar incentives.”
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