In an August 27th webinar, Centers for Medicare & Medicaid Services (CMS) administrator Seema Verma emphasized that her agency believes that two-sided risk ACO models are highly beneficial in reducing healthcare costs, reported Healthcare Informatics‘ associate editor Heather Landi.

“Next Gen ACOs are taking the highest levels of risk and they’ve managed to maintain quality while still lowering cost,” Verma said.

CMS further reported that, in the 2016 performance year, the Next Gen ACO Model saved Medicare approximately $62 million — a spending reduction of 1.1% for organizations operating within that program.

“Savings achieved by the Next Gen ACOs were largely due to reductions in hospital spending and spending in skilled nursing facilities,” she noted. “That’s very consistent with what we’ve seen with how other two-sided ACOs have achieved savings.”

Accordingly, CMS last month proposed to streamline the Medicare Shared Savings Program’s (MSSP) three participation tracks into two riskier, 5-year-mandatory tracks:

• BASIC, under which organizations begin with one-sided risk but gradually assume more financial exposure.
• ENHANCED, which begins with higher risk but offers more flexibility and higher incentives.

Get the full story here, from Healthcare Informatics.