ACOs and the 1%: Changes in Spending Among High-Cost Patients Following the Medicare Shared Savings Program

Excerpt

Accountable Care Organizations (ACOs) were created by the Centers for Medicare and Medicaid Services (CMS) to improve efficiency and reduce unwarranted regional variations in spending. Because a small subset of high-cost patients drive total Medicare spending and may drive spending variation within and across regions,¹ reducing spending among these patients is critical. Studies suggest the Medicare Shared Savings Program—CMS’ flagship ACO program—is associated with modest spending decreases.^{2, 3} However, it is unknown whether the MSSP has reduced spending for high-cost patients, and, if so, whether this has reduced regional spending variation. We asked two research questions: First, has the MSSP reduced spending for high-cost beneficiaries who potentially drive regional spending variation? Second, has the MSSP reduced spending variation within regions overall? …