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CMS announced that Accountable Care Organizations (ACOs) participating in the Medicare Shared Savings Program generated net savings of $739.4 million last year, and data suggests that physician-led ACOs continued to perform better than hospital-led ACOs. The savings came from 548 ACOs, which served around 10.1 million Medicare beneficiaries last year. Of these, 66 percent generated savings for Medicare by reducing their costs compared with benchmarks set by CMS. Additionally, 37 percent generated enough savings to collect shared savings payments.
The Medicare Program is the second largest social insurance program in the United States with a total expenditures of $741 billion in 2018. A ten percent savings would generate $74.1 billion. The $739.4 million savings generated in 2018 is a 0.1 percent savings for the system annually. Medicare costs $2.03 billion each day, so the heralded ACO savings would cover only about 8 hours and 45 minutes of Medicare’s expenses…