Spending to Save—Accountable Care Organizations and the Medicare Shared Savings Program

NEJM Perspective: Providers Should Consider ACOs More Than a Short-Term Business Opportunity

Media Advisory
May 25, 2011

FURTHER INFORMATION, CONTACT:
Alwyn Cassil (202) 264-3484 or acassil@hschange.org

WASHINGTON , DC—While criticism that the government set the bar too high for accountable care organizations (ACOs) has been fast and furious, the proposed rule for the Shared Savings Program is a wake-up call that Medicare is serious about achieving better care for individuals, better health for populations and lower growth in expenditures, according to a perspective by Paul B. Ginsburg, president of the Center for Studying Health System Change (HSC), published online today in the New England Journal of Medicine.

While constructive comments on the proposed rule can help the Centers for Medicare and Medicaid Services (CMS) “achieve its triple aim in a more workable manner, CMS shouldn’t be too quick to lower the ACO bar too far: the initial ACO opportunity should not be for everybody,” according to the article.

Much of the criticism of the proposed rule centers on providers contending they will have to invest too much to improve care delivery without enough assurance of a financial upside.

“But providers should consider ACOs as more than a short-term business opportunity. The shift from volume-driven to value-driven payment is inevitable, and getting limited shared savings while embarking on the needed investments to build the infrastructure and relationships for improving delivery is better than getting no rewards under the fee-for-service system. It may be better to spend now in order to save later and avoid the consequences of the inevitable ratcheting down of fee-for-service rates,” the article states.

The Center for Studying Health System Change is a nonpartisan policy research organization committed to providing objective and timely research on the nation’s changing health system to help inform policy makers and contribute to better health care policy. HSC, based in Washington, D.C., is affiliated with Mathematica Policy Research.