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Accountable care organizations save money at cost of skilled nursing

August 29, 2018
by I Advance Senior Care
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The Next Generation Accountable Care Organization (ACO) Model netted Medicare about $62 million in net savings in its first year of operations — and cutting spending in skilled nursing facilities was a key driver for the decrease.

Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma first announced the news in a webinar hosted Monday by the Accountable Care Learning Collaborative (ACLC) at Western Governors University, according to Skilled Nursing News.

Most of the reductions came from decreases in hospital and SNF spending; the almost $62 million represents a net reduction of approximately 1.1% in overall Medicare spending. SNFs were the most common type of institutional provider in the model, according to the first annual report evaluating the Next Generation ACO model.

Next Generation ACO providers reduced spending for beneficiaries by $100.08 million in the first performance year (PY 2016) the report said. Most of that spending decline could be attributed to decreased Medicare spending on post-acute care, especially spending cuts in SNFs that hit the threshold for statistical significance at $16.61 million.

CMS also found reductions in the number of inpatient hospital days and non-hospital evaluation and management visits per month, as well as increases in the number of yearly wellness visits by Next Generation providers.

Read the full story at Skilled Nursing News.

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