On January 30, CMS released interim financial results for its Medicare Accountable Care Organizations (“ACOs”), the Physician Group Practice Demonstration (“PGPD”), and the Bundled Payments for Care Improvement (“BPCI”) Initiatives.
Savings from the Medicare ACOs exceeded $380 million. The interim financial results released show that nearly half (54/114) of the ACOs that started the program operations in 2012, already had lower cost expenditures than projected. Of the 54 ACOs, 29 generated shared savings totaling more than $126 million; these ACOs also generated $128 million in net savings for the Medicare Trust Funds. Final results for Year 1 will be released later this year.
Next, CMS released savings for the PGPD initiatives that totaled $108 million over the five-year experiment. The PGPD initiatives offered incentive payments for delivering high-quality, coordinated healthcare to improve the quality and efficiency of care.
Finally, CMS announced that 232 acute care hospitals, skilled nursing homes, physician group practices, long-term care hospitals, and home health agencies have entered into agreements to participate in the BPCI initiative. This marks the largest and most ambitious test ever of a bundled payment model in Medicare or any other payer in the US. Bundling refers to episode-based payments that patients receive across a single episode of care, such as heart bypass surgery or a hip replacement. The aim of BPCI is to encourage doctors, hospitals and other healthcare providers to collaborate and better coordinate care for patients, both when they are in the hospital and after discharge.