Home Health care provider Medicare Program That Promotes Rural Health Care Generates Net Savings of $ 381.5 Million | News

Medicare Program That Promotes Rural Health Care Generates Net Savings of $ 381.5 Million | News



ROCKVILLE, MD., January 7, 2022 / PRNewswire-PRWeb / – A new study by Abt Associates and its partners published in Health Affairs found that a program to support rural health care providers $ 381.5 million in net savings for Medicare. The savings accumulated over three years, mainly due to the decrease in hospitalizations and other institutional care services. This study expands on the results of the evaluation of the responsible organization of care (ACO) investment model (AIM) to improve health care delivery in rural and underserved areas while maintaining quality care for people. the patients. ACOs are groups of doctors, hospitals, and other health care providers who participate in Medicare’s shared savings program. As part of the AIM, ACOs received upfront payments that were clawed back from subsequent savings shared by ACOs and Medicare.

The downside risk must be taken into account

While Medicare, participating healthcare providers and patients benefited from AIM, nearly two-thirds of the 41 AIM ACOs left the program at the end of their three-year tenure. Continuing with the shared savings program would have required ACOs to assume downside risk (i.e. the potential for financial losses in addition to receiving upfront payments), and many ACOs cited this requirement as the reason for their exit. Abt’s study found no difference in the estimated savings provided by existing ACOs compared to the remaining ACOs. These results, coupled with the large net savings to Medicare attributable to the model before ACOs even assume the downside risk, suggest that the insistence on including downside risk for ACOs can dramatically reduce the opportunities for Medicare to save. money.

Overall, therefore, AIM has had mixed success. On the one hand, the reductions in total Medicare spending have been substantial and greater than those of a similar previous model. On the other hand, the initial investments in AIM ACOs were not sufficient to maintain participation in the face of downside risk, even though they were successful in encouraging ACO participation in more rural and underserved markets.

Implications for CMS GRAPHICS

CMS’s recently announced Community Health Access and Rural Transformation (CHART) model, in which there are two prongs, a hospital-driven model and an ACO transformation model similar to AIM, aims to help stabilize the income of hospitals in rural areas. Our findings from the AIM assessment have several implications for CHART. First, policymakers may find it beneficial to allow rural providers of the ACO transformation pathway to follow a slower path to take on downside risk. This could encourage sustained participation, which could potentially generate greater long-term savings for Medicare.

Second, while preventing unnecessary stays in hospitals or skilled nursing facilities is beneficial for beneficiaries, these efforts are associated with reductions in Medicare revenues for rural inpatient facilities. This reduction in services can exacerbate financial pressures on facilities, potentially contributing to additional closures and further reducing access to health care providers in underserved areas. Our results suggest that policymakers should carefully consider how much Medicare savings to keep for Medicare and how much to reinvest in supporting providers in underserved areas.

“At a high level, the significant savings tell us that ACOs can be successful without risk of loss,” says Matt trombley, the principal investigator of Abt. “The question that needs to be answered in subsequent models like CHART is whether Medicare can strike the right balance to continue to encourage and maintain COA participation because, in those first three years, everyone takes advantage.”


About Abt Associates

Abt Associates is a global consulting and research firm that combines data and bold thinking to improve the quality of people’s lives. We work in partnership with clients and communities to advance equity and innovation, from creating scalable digital solutions and combating infectious diseases, to climate change mitigation and assessment of programs for measurable social impact, and more.


Media contact

Eric Tischler, Abt Associates, 301-347-5492, eric_tischler@abtassoc.com

SOURCE Abt Associates