Accountable Care Research


In 2012, CMS’ Pioneer accountable care organization (ACO) program was launched in 32 health care organizations. Researchers from three Boston-area institutions — Harvard Medical School, Brigham and Women’s Hospital, and Beth Israel Deaconess Medical Center — collaborated to see how the various ACOs performed in the first year of the program. Here is the headline from the AAFP e-newsletter:

Pioneer ACO initiative shows first-year savings, study says

Sounds awesome, right?  Now the results:

  1. 13 ACOs that left the Pioneer program after 2012 and 19 ACOs
  2. In 2012, the per-beneficiary spending in the ACO group decreased by $29.2 per quarter for an overall savings of 1.2 percent.
  3. Regarding changes in performance on quality measures in the ACO group compared with the control group, study authors reported either small but significant improvements or no significant change.
  4. When aggregated to the entire ACO population, total Medicare spending was about $118 million lower than expected, “a sum that falls between the actuarial calculation of $87 million by the CMS and an estimate of $147 million in a previous evaluation”.
  5. “Our estimate exceeds the $76 million in bonuses paid by CMS to Pioneer ACOs by $42 million.”

And now the cherry on top of the sundae:

  • Researchers listed several study limitations, including that their estimate of savings did not include CMS’ costs to administer an ACO program or the costs incurred by ACOs to implement strategies to limit spending.

To summarize:

  1. 40% of the ACOs quit!
  2. A savings of 1.2 %
  3. No change in performance
  4. No one cared to look at how much this cost to administer

Does this sound worth it to anyone?  Well, yes, the AAFP loves it.  Reread their headline from above.  Can they be more biased or clueless?

(The image on above is their renew icon for me to hit. Not.)

Douglas Farrago MD

Douglas Farrago MD is a full-time practicing family doc in Forest, Va. He started Forest Direct Primary Care where he takes no insurance and bills patients a monthly fee. He is board certified in the specialty of Family Practice. He is the inventor of a product called the Knee Saver which is currently in the Baseball Hall of Fame. The Knee Saver and its knock-offs are worn by many major league baseball catchers. He is also the inventor of the CryoHelmet used by athletes for head injuries as well as migraine sufferers. Dr. Farrago is the author of four books, two of which are the top two most popular DPC books. From 2001 – 2011, Dr. Farrago was the editor and creator of the Placebo Journal which ran for 10 full years. Described as the Mad Magazine for doctors, he and the Placebo Journal were featured in the Washington Post, US News and World Report, the AP, and the NY Times. Dr. Farrago is also the editor of the blog Authentic Medicine which was born out of concern about where the direction of healthcare is heading and the belief that the wrong people are in charge. This blog has been going daily for more than 15 years Article about Dr. Farrago in Doximity Email Dr. Farrago – [email protected] 

  1 comment for “Accountable Care Research

  1. Steve O'
    May 2, 2015 at 1:24 pm

    And what are they going to do about it? Boston drivers are famous for their surprise U-turns, but this one’s a doozy…

    “For instance, because the authors found no link between estimated savings and continued participation in the Pioneer ACO, “Sustaining or expanding participation in a Pioneer-like ACO program will probably require greater and more reliable awards for ACOs that reduce spending than those currently in place.”

    They also suggested that analysts proposing changes to ACO payment rules “should consider lost savings from organizations that withdraw from the ACO programs in response to current incentives. Stronger incentives to participate in ACO programs would diminish the share of savings appropriated by Medicare for a given ACO but could lead to more ACOs generating savings,” they said.

    Lastly, the authors suggested a gradual lowering of benchmarks for high-spending ACOs compared with those for lower-spending ACOs.

    “Constraining growth in benchmarks for ACOs with high spending could be important for establishing equitable benchmarks and fostering healthy competition among ACOs,” they wrote.”

    So if you fail, redouble the efforts! Pay them more AND pay them less! Lock the back door – always a necessary plan in any Socialist enterprise. “No Exit” is not a sign of hope.

    If your worthless relative runs a hot-dog cart, and he takes in $76 worth of revenue, and you have to spend between $87 and $147 to keep it afloat, the business is failing. You gotta start selling horsemeat or worse to keep him in business. The ACO’s are starting to understand.

Comments are closed.