Case Study: Medicare Shared Savings Program

The Patient Protection and Affordable Care Act (Obamacare) had mame dramatic changes in the field of the health care system, especially in Medicare, that will seriously take effect in American seniors. Indeed, much of the health law’s new spending is financed by spending reductions in the Medicare program. In addition to the provider payment reductions, Obamacare significantly reduces payments to Medicare Advantage (MA) plans by an estimated $156 billion from 2013 to 2022.( Elmendorf, letter to Speaker Boehner). About 27 percent of all Medicare beneficiaries are enrolled in MA plans, a system of regulated and private plans competing against each other as an alternative to traditional Medicare. MA plans are attractive to beneficiaries because they offer more generous and comprehensive coverage than traditional Medicare by capping out-of-pocket costs and offering drug coverage to a rasonable

Healthcare is often driven by consumers and insurance companies; there is strong pushes for insurance companies to start paying better through Patient Care Medical Homes (PCMH) or Accountable Care Organizations (ACO) rather than paying at a per-visit basis (Hamlin, 2015). With PCMH or ACOs payment is made on a continuum of care, encouraging the provider to be involved in all aspects affecting health of the patient (Derksen, & Whelan,

The Accountable Care Organization (ACO) are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high-quality care to their Medicare patients (McCarty, B., 2016). For example, Medicare Shared Savings Program was created by The Center for Medicare & Medicaid Services to monitor and establish that all ACO’s are meeting the quality performance benchmarks and reduce Medicare spending by certain percentages (H., 2017). The growth of ACO’s from 2011 to 2016 is astonishing, in 2011 there was 64 ACO’s and by 2016 they have risen to 838 in the U.S. (H., 2017).

This paper will discuss what the Accountable Care Organization is, why did Congress include it in their law, benefits and challenges for physicians and patients, and how does the ACO work for patients. We will also identify the quantitative methods in the ACO and reflect on the information provided.

The Medicare Shared Savings Program was established by section 3022 of the Affordable Care Act and aims to improve beneficiary outcomes and increase the value of care by providing better care for individuals, better health for populations, and lowering growth in expenditures (Lieberman, & Bertko, 2011). The Affordable Care Act created ACOs, which is part of Medicare since January 2012, together with a Shared Savings Program it has the potential to lower costs, improve the quality of care, facilitate delivery system reform, and promote innovation in health care ( Lieberman, & Bertko, 2011).

One of these examples is the Meridian Health Accountable Care Organization. “In January 2013, Meridian was selected by the Centers for Medicare &Medicaid Services (CMS) to participate as a Medicare Accountable Care Organization (Meridianhealth.com). When a system is selected to become an Accountable Care Organization it can choose one of three routes. They are Medicare Shared Savings Program, Advanced Payment ACO Model, and Pioneer ACO Model. Meridian Health chose the shared savings program. This program goals include better care for individuals, better health for populations and lowering growth in expenditures. The Shared savings program also rewards “ACOs that lower growth in health care costs while meeting performance standards on quality of care and putting patients first” (CMS.gov). The next type of ACO is the Advanced Payment Model. This model is “designed for physician-based and rural providers who have come together voluntarily to give coordinated high quality care to the Medicare patient they serve… selected participants will receive upfront monthly payments”(CMS.gov). This form of ACO is for systems that do not meet the requirements for Shared Savings because they are too small in size and they do not have access to capital so that they can invest in upgrading their system. So far there are 35 ACO using this model and so that they can

The health restructuring dispute has centered on compensating providers particularly more when delivering quality care to their patients than for enhancing the volume of services they provide (Ries, 2014) Accountable care organizations (ACOs) is a single proposed way of altering compensation methods to accomplish this objective by generating encouragement to enhance care coordination and clinical integration (Thygeson, Frosch, and Carman, 2014).

The accountable care organization I researched is called the Physician Organization of Michigan ACO (POM ACO). The POM ACO is a joint venture of the U-M Health System and physician groups around the state, with the aim of improving care for 81,000 Michiganders enrolled in traditional Medicare and slowing the growth of health care costs, according to the announcement by the U-M Health System (Daly, 2013). The group was launched on January 1, 2013 under the Medicare Shared Savings Program. 12 physician organizations from around Michigan came together to take part in a Medicare-sponsored program that strives to improve on the quality of care for traditional Medicare recipients, while also containing cost growth. In 2014, POM ACO expanded to include all the University of Michigan faculty physicians and thousands of other providers from the University of Michigan Health System. The POM ACO is now one of the largest accountable care organizations nationwide. More than 5,700 physicians and other providers are now involved in the POM ACO. Therefore, the POM ACO is organized as a physician-hospital organization. Hence, the patient has more flexibility in where and how their care is delivered. The patient can still use any doctor or hospital that accepts Medicare at any time.

Another provision that the ACA provided was creating the Center for Medicare & Medicaid Innovations within the Centers for Medicare & Medicaid Services (CMS) in order to test new payment and service delivery models designed to reduce costs and increase quality of care to those that receive these benefits.² In this briefing, information about this organization, including financing and delivery, and the impact of the ACA on the Medicaid Program and the

​Kaiser Health News recently published an article on a new trend in healthcare. This trend introduces the Accountable Care Organization (ACO). The Centers for Medicare and Medicaid services defines it as “groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients” (“Accountable Care Organization,” 2015). According to the Affordable Care Act (ACA), the goal of the ACO is to be able to share health cost-savings with providers who are able to save money by eliminating unnecessary procedures and reduce health costs while increasing quality of care. ACOs make health professionals become more accountable in maintaining good-quality, coordinated healthcare for a patient through a value-based system that is evaluated through a number of criteria and benchmarks (Ronai, 2011).

The delivery system reform include: Mandates that the Secretary of Health and Human Services adopt value-based purchasing and payment methods for Medicare reimbursements for both physicians and hospitals. Creates incentives to reduce preventable hospital admissions. Creates a new Center for Medicare and Medicaid Innovation that will research, develop, test, and expand innovative payment and delivery arrangements. Encourages the formation of Accountable Care Organizations (ACOs) that allow hospitals and doctors to work together to manage and coordinate care and provides that these ACOs will receive a share of the savings they achieve for Medicare

The Patient Protection and Affordable Care Act (PPACA), also referred to as the "Affordable Care Act" or "ACA" or "Obama Care") is the major health care reform bill passed into law on March 23, 2010. The debates surrounding the PPACA have been volatile at times, and continue to be the most intense public examinations of any piece of legislation in our recent history. The affordable Care Act (Obamacare) is ripe for repeal. For the American public, there are ample reasons for dissatisfaction: higher costs; arbitrary and sometimes absurd rule-making; bureaucratization of an already overly bureaucratized sector of the economy; incompatibility with personal freedom and religious liberty; enormous spending and heavy taxation; and widely acknowledged design flaws, evident in the ACA’s hopelessly complex and unworkable subsidy schemes, boondoggle bailouts, and collapsing co-ops. Nonetheless, other ACA legal challenges were still facing the healthcare law. In December 2015, the Association of American Physicians and Surgeons (AAPS) submitted an amicus brief to the Supreme Court arguing against the constitutionality of the employer insurance mandate within the Affordable Care Act. The law contains a number of experiments designed to drive down health costs, such as Accountable Care Organizations. The whole idea is to move the system away from paying for volume and toward paying for value. We still don't know whether that will happen. But it's fair to say that reducing the cost of health care will make it easier to expand coverage. The nation’s gains in health care coverage and delivery system design over the last several years have made measurable differences in the lives of millions of Americans. There are many ways to achieve a high-performing health system. But it’s critical that the nation remain committed to this goal.

Please read and review the outside and background sources/readings listed in your Syllabus. Please select one healthcare issue (policy/position/topic) that is of interest to you and discuss how it should be addressed politically and as a healthcare policy. Be sure to include the economic impact of such. Support your position with outside sources.

In this paper you are going to learn all about the Accountable Care Organization (ACO). Also, how does it pertain to the healthcare system? We will also be learning about the reimbursement rates for Medicare patients. Who makes up the Accountable Care Organization? We will also take a look into the Affordable Care Act and how the ACO is a part of that.

The American health care system has been victim to an escalation in the prices of health care services juxtaposed with inefficiency in delivery of care services. There has even been cases where State spending on the actual health care increased dramatically in the United States and one of the key components of curbing this problem which has been prevalent over the mass media and has been a major discussion among physicians is the advent of Accountable Care Organizations. Accountable Care Organizations (ACOs) is structured with the goal of trying to improve health care delivery and aid in the reduction of the overall cost of services (Weissert & Weissert, 2012). If there is insufficient coordination of high quality care delivery in the health care industry, this will have a negative impact on patient safety and diminish affordable care for patients. Hence, the development of ACOs is envisioned to be the savior of medical practices and can improve the overall fabric of the American society (Bresnick, 2013). ACOs serves as one of the answers for curbing the problem of high costs, low quality care and possible segmented delivery and as much as it serve as the major determinant for improvement in patient satisfaction, there are minor