About a quarter of the 243 groups of hospitals and doctors that banded together as accountable care organizations under the Affordable Care Act saved Medicare enough money to earn bonuses, the Centers for Medicare & Medicaid Services announced Tuesday.
Those 64 ACOs earned a combined $445 million in bonuses, the agency said. Medicare saved $372 million after accounting for the ACOs that did not show success, including four that overspent significantly and now owe the government money.
The bonuses, losses and Medicare savings are teensy sums in the context of a program that spends half a trillion dollars a year on care for the elderly and disabled. But the Obama administration views the results so far as evidence that reorganizing the financial incentives for doctors and hospitals — a key element of the health law – can translate to substantial savings if the program expands nationwide.
ACOS are voluntary affiliations in which doctors and hospitals join together to coordinate care with the lure of earning extra money if they save Medicare money while maintaining the health of their patients. The program aims to encourage doctors to focus on keeping patients healthy and to intervene quickly if they are struggling, rather than waiting until they need complex — and for doctors in the old pay model, lucrative — operations or other kinds of care.
There are now more than 360 Medicare ACOs caring for about 5.6 million elderly Americans, although some of these ACOs are new enough that Medicare is not assessing their performance.