August 28, 2018
The Centers for Medicare & Medicaid Services (CMS) released the first annual report on the Next Generation Accountable Care Organization (ACO) model. The report provides results from the 18 active Next Gens who participated beginning January 2016. Key findings from the report showed that Next Gen ACOs reduced spending by approximately $100 million (a 1.7 percent reduction), or $62 million after adjusting for shared savings/shared losses. The savings appears to be associated with reductions in hospital and skilled nursing facility costs. Notably, over half of the model’s cost and utilization decline was generated by four of the 18 Next Gens.
The Next Gen model was intended to test whether stronger financial incentives could improve care and reduce costs for traditional Medicare beneficiaries. ACOs in the Next Gen model assume 80-100 percent two-sided risk and have additional flexibilities compared to other Medicare ACOs. The ACO program is slated to run through December 31, 2020. The Next Gen ACO model is one of a handful of qualifying Advanced Alternative Payment Models under the Quality Payment Program.
The full report is available here.
The findings at a glance are available here.
The CMS press release is available here.