ACOs led by independent physicians save Medicare ‘substantially’ more money, CBO says

Healthcare DIVE April 17, 2024
Rebecca Pifer

Independent practices have clearer financial incentives to lower medical spending than hospitals participating in accountable care organizations, according to the Congressional Budget Office.

Dive Brief:

• Accountable care organizations led by independent physicians save Medicare more money than other types of ACOs, according to a new Congressional Budget Office review of existing research.
• Independent physician-led ACOs have clear financial incentives to reduce hospital care to lower spending, while hospital-led ACOs — which earn more revenue when patients are admitted — do not, the CBO found. Hospitals also have less direct control over what services patients receive.
• ACOs with a larger proportion of primary care providers also saved Medicare more money, along with ACOs whose initial spending was higher than their...

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