ACOs Are Coming to an End

A report by the National Association of ACOs (NAACOS) shows that ACOs (Accountable Care Organizations) participating in the Medicare Shared Savings Program are making preparations to abandon Obamacare’s ACO initiative. The report shows that 66% are not intending to stay in the program and another 26% are currently undecided. That leaves a mere 8% of ACOs which are planning to sign a second contract with the government. The president of NAACOS stated that if CMS doesn’t address issues, the program “will no longer exist and the high hopes of DC policy-makers to migrate ACOs to capitation and two-sided risk will be impossible.”

NAACOS also reported that the costs to run the ACOs are insurmountable. Respondents reported an annual mean of $1.5 million management costs directly attributable to ACO operations.

There are also issues with the metrics CMS uses. The report shows that no ACO would have had a perfect quality score, and every ACO that achieved shared savings with CMS would have had those savings reduced by the quality scores. The president of NAACOS summed it up well when he stated, “The huge investment by ACOs in improved care goes largely unrewarded.” This is yet another example of how healthcare reform has fallen short of intended goals. NAACOS President Clif Gaus said, “While CMS has made modest improvement to the ACO Quality Benchmarking, it is still a punitive program that will only lead to future reductions in savings paid to the ACOs who have worked hard to achieve those savings. Coupled with the many attribution and financial benchmarking defects, the Medicare Shared Savings Program is not sustainable in its current configuration and will decelerate the pathway to accountable care for Medicare Beneficiaries.”

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