Department of Health and Human Services 
OFFICE OF 
 
INSPECTOR GENERAL 
 
 
 
 
 
M S S
EDICARE  HARED  AVINGS 
 
 
P A
ROGRAM  CCOUNTABLE 
 
C O  
ARE  RGANIZATIONS 
H S P
AVE  HOWN  OTENTIAL 
R S
FOR  EDUCING  PENDING 
I Q  
AND  MPROVING  UALITY 
 
 
Daniel R. Levinson   
Inspector General  
 
August 2017 
OEI-02-15-00450  Report  in  Brief    
   
August 2017 
OEI021500450  
 
  
Medicare Shared Savings Program Accountable Care  
Why OIG Did This Review 
Medicare spending is expected to  Organizations Have Shown Potential for Reducing Spending 
grow to $1.4 trillion by 2027.  To  and Improving Quality 
control this increase and promote 
 
quality and healthy populations, the   What OIG Found 
Key Takeaway
Centers for Medicare & Medicaid 
Over the first 3 years of the program, 
Services (CMS) has implemented and   Most Shared Savings Program 
428 participating Shared Savings Program 
is considering  a number of  ACOs were able to reduce 
ACOs served 9.7 million beneficiaries.  During 
Medicare spending  and  
alternative payment models that  that time, most of these ACOs reduced  
improve  quality of care in the 
reward providers for the quality and  Medicare spending compared to their  
first 3 years of the program.  A  
value of services.  The goal  is to  benchmarks, achieving  a net spending  
small subset of these ACOs 
incentivize  providers to keep patients 
reduction of nearly $1 billion.  Onethird of  showed substantial reductions 
healthy  and thus lower costs.   ACOs reduced spending  enough to receive a  in Medicare spending for key  
The Medicare Shared  Savings  portion of the savings.  ACOs participating in   services. 
Program is one of the largest  the program longer were more likely  to   As alternative  payment models 
alternative payment models. As part  reduce spending and by greater amounts  further  take shape, these high
of this program, health care  than other ACOs.  This suggests that more  performing ACOs are worth a  
providers form Accountable Care  established  ACOs are learning how  to achieve  close  look to  understand the 
Organizations (ACOs) to coordinate  greater cost savings over time.   strategies they are employing. 
care to reduce costs and improve 
At the same time, ACOs generally improved the quality of care they provided, 
quality of care. Information about 
based on CMSs data on quality measures.  In the first 3 years, ACOs improved 
the extent to which  ACOs are able to 
their performance on most (82 percent) of the individual quality measures.  These  
reduce Medicare spending and  33 measures track various aspects of care provided  to beneficiaries, such as the 
improve quality is critical to inform  percentage of beneficiaries screened for depression.  ACOs also  outperformed 
future developments as ACOs and  feeforservice providers on most (81 percent) of the  quality  measures.   
other alternative payment models 
Further, a small subset of ACOs showed  substantial reductions in Medicare 
evolve. 
spending while providing highquality care.  These  highperforming ACOs  
How OIG Did This Review  reduced spending by an  average of $673 per beneficiary for key Medicare 
We analyzed beneficiary and  services during the review period.  This included significant spending reductions  
provider data  from CMS to  describe  for highcost services such as inpatient hospital care and skilled nursing facility 
the characteristics of ACOs. We also  care. These ACOs also maintained high use of primary care services, which can 
analyzed spending and quality data   lower utilization and costs for other care, and reduced the use of costly services 
to determine the extent to which  such as emergency  department visits.  In contrast, other Shared Savings 
ACOs reduced Medicare spending  Program ACOs and the national average for feeforservice providers showed an  
and improved quality in the first  increase in per beneficiary spending for key Medicare services.    
3 years of the program.  Lastly, we 
With any major payment reform, time may be needed for organizations to make 
analyzed spending and utilization 
changes  to improve quality and lower costs.  While policy changes may be  
data to describe how high
warranted, ACOs show promise in reducing  spending and improving quality.   
performing ACOs reduced  spending  
However, additional information about highperforming ACOs would inform the 
and made changes to utilization for 
future direction of the  Shared Savings Program as well as other alternative 
key services.    
payment models.  
 
   
Full report can be  found at http://oig.hhs.gov/oei/reports/oei021500450.asp
  
     
   
TABLE OF CONTENTS 
 
Objectives ....................................................................................................1 

Background..................................................................................................1 

Methodology................................................................................................5 

Findings........................................................................................................8 

In the first 3 years of the program, a total of 428 ACOs served           
9.7 million beneficiaries ..................................................................8 

Most ACOs were able to reduce Medicare spending over the first 

3 years of the program; the net reduction in spending across all 

ACOs was about $1 billion............................................................10 

Overall, ACOs improved quality in the first 3 years of the    

program..........................................................................................12 

High-performing ACOs reduced Medicare spending for key 

services and made cost-effective changes in utilization ................15 

Conclusion .................................................................................................20 

Appendices.................................................................................................22 

A: Detailed Data Sources and Analysis ........................................22 

B: ACOs  Performance on Individual Quality Measures,          
  
2013 to 2015 ..................................................................................28 

C: ACOs  Performance on Quality Measures Compared to   
        
Fee-for-Service Providers, 2013 to 2015 .......................................30 

D:  Changes in Average Medicare Spending per Beneficiary  

for ACOs, 2010 to 2015 .................................................................31 

E: Average Medicare Spending per Beneficiary for Key  

Services, 2010 to 2015...................................................................32 

F:  Changes in Average Utilization per Beneficiary for ACOs,   

2010 to 2015 ..................................................................................35 

G: Average Utilization per Beneficiary for Key Services,  

2010 to 2015 ..................................................................................36 

Acknowledgments......................................................................................39
	
     
   
OBJECTIVES 
1. 		 To describe Accountable Care Organizations (ACOs) in the Medicare 
Shared Savings Program. 
2. 		 To determine the extent to which ACOs reduced Medicare spending in 
the first 3 years of the program. 
3. 		 To determine the extent to which ACOs improved quality in the first 
3 years of the program. 
4. 		 To describe the spending and utilization of high-performing ACOs 
compared to other Shared Savings Program  ACOs and the national 
average.  
BACKGROUND 
Medicare spending is expected to grow to $1.4 trillion by 2027, more than 
double the $689 billion in spending in 2016.1   To help control the expected 
increase and promote quality and healthy populations, the Centers for 
Medicare & Medicaid Services (CMS) is implementing a number of 
alternative payment models that reward providers for the quality and value 
of services. The goal is to incentivize ACOs to provide higher quality care, 
fewer unnecessary services, and appropriate preventive services to keep 
patients healthier and thus lower costs over time.2    
The Medicare Shared Savings Program (Shared Savings Program) is one of 
the largest alternative payment models, accounting for $168 billion in 
Medicare expenditures over the first 3 years of the program.3   As part of the 
program, health care providers form  ACOs and enter into a 3-year contract 
with Medicare.  Providers in each  ACO coordinate to reduce Medicare 
costs and improve quality of care.4  If an ACO is successful and meets 
                        ____________________________________________________________ 
1 Congressional Budget Office, Medicare   Congressional  Budget Offices January 2017  
Baseline. Accessed at https://www.cbo.gov/sites/default/files/recurringdata/51302-2017-
01-medicare.pdf on  March 20, 2017. 
2 CMS, First Accountable Care Organizations Under the Medicare Shared Savings 
Program,  April 10, 2012.  Accessed at 
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2012-Fact-sheets-
items/2012-04-10.html on June 12, 2017.  
3 P.L. No.  111-148 (Mar.  23, 2010), as amended by the Health Care and Education 
Reconciliation  Act of 2010, P.L. No. 111-152 (Mar. 30, 2010).  The Medicare Shared  
Savings  Program  is established by section 3022, which amended section 1899 of  the 
Social Security Act. 
4 CMS, Shared Savings  Program. Accessed at https://www.cms.gov/Medicare/Medicare-
Fee-for-Service-
Payment/sharedsavingsprogram/index.html?redirect=/SharedSavingsProgram/ on 
March  8, 2017.  
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1     
and Improving Quality  (OEI-02-15-00450)  
   
   
certain Medicare requirements, it is eligible for a portion of the savings it 
generates for Medicare. 
ACOs can vary widely in structure.  Some  ACOs  are made up entirely of  
physicians, while others include physicians and other entities, such as 
hospitals, nursing homes, and home health agencies.  As with fee-for-
service Medicare, beneficiaries assigned to an ACO may choose their own 
health care providers, even if those providers are not a part of the ACO.   
In the first 3 years of the Shared Savings Program, ACOs could enter the 
program under one of two tracks.5  In Track 1, ACOs may be eligible for a 
share of the Medicare savings and are not responsible for paying back any 
portion of the losses.6  In Track 2, ACOs may be eligible for a larger share 
of the savings if they accept downside risk for paying back a certain 
amount of the losses.7    
Cost Savings 
Each ACO is accountable for the total cost of care for their assigned 
beneficiaries, even if the care is provided outside of the ACO.   At the 
beginning of the performance year, a beneficiary is assigned preliminarily 
to a particular ACO if he or she received a plurality of primary care 
services from providers in the  ACO during the previous year.  At the end of 
the performance year, a beneficiary is retrospectively assigned to an ACO if 
he or she meets the primary care services requirement for the performance 
year.  Each ACO is responsible for a minimum of 5,000 beneficiaries.8    
For each performance year, CMS compares the ACOs spending against  a  
historical benchmark.  CMS calculates this benchmark for each ACO by 
first determining the average annual spending for each beneficiary who 
would have been assigned during the 3 years immediately prior to the 
                        ____________________________________________________________ 
5 CMS recently created a Track  3, which allows ACOs  to share a higher percentage of the 
savings and losses than Track 2.  This new track became available in 2016.  81 Fed. Reg.  
32692, 32771-81 (June 9, 2015).    
6  CMS  established  a  minimum savings rate and minimum loss rate to  account for normal  
variation in spending based on the  number of assigned beneficiaries.  To receive a portion 
of the savings, an ACO must  meet this minimum  savings rate and  meet quality 
performance standards set by CMS.  See CMS, Medicare Shared Savings Program:  
Shared  Savings and Losses and Assignment  Methodology.  Accessed at 
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/sharedsavingsprogram/Downloads/Shared-Savings-Losses-Assignment-Spec.pdf  
on March 8, 2017.   
7 Medicare Access and CHIP Reauthorization  Act of 2015  (MACRA), P.L. No. 114-10 
(April 16, 2015) provides incentives for ACOs to accept downside risk and participate in  
Tracks 2  and 3.  Under the Quality Payment Program, physicians and other clinicians who  
participate in ACOs  in those tracks are eligible to receive bonus payments starting  in  2019.  
8 42 CFR   425.110.    
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2     
and Improving Quality  (OEI-02-15-00450)  
   
   
ACOs contract period (hereafter referred to as benchmark years).9  CMS 
then adjusts this amount for factors such as beneficiary characteristics and 
the projected growth in Medicare fee-for-service spending.10   
If an ACOs  spending for the performance year is below the benchmark, 
then the ACO may be eligible to share in the cost savings.  ACOs in  
Track 1 may receive shared savings payments of up to 50 percent of the 
cost savings,  while ACOs in Track 2 may receive up to 60 percent of the 
cost savings.11  See Exhibit 1.  In Track 2, if an ACOs spending for the 
year exceeds the benchmark, it may be responsible for up to 60 percent of 
the losses.12  In the first 3 years of the program, only five ACOs participated 
in Track 2.13  
Exhibit 1: Differences Between Track 1 and Track 2 ACOs   
Track 1  Versus   Track 2 
   
   Upside risk only:      Upside and downside risk: 
   
 ACOs may  receive shared savings    ACOs may  receive shared savings  
payments of up  to 50 percent  payments of up  to 60 percent 
   
 ACOs may be  responsible for up to   
60 percent of the losses  
 
   
                        ____________________________________________________________ 
9 For ACOs  that renewed their contracts for a second or subsequent agreement  period  
starting in  2017, their  benchmarks also incorporates trends in regional  spending.  See 81  
Fed. Reg. 37950, 37954-69  (June 10, 2016). 
10 42  CFR   425.602(a).   

11 42  CFR   425.604(d); 42 CFR  425.606(d). 

12 42 CFR  425.606(f)(2).  For purposes of calculating shared losses for the Shared 

Savings  Program, CMS considers  losses  to be spending that  exceeds the benchmark in any 
	
given year, rather  than inappropriate Medicare payments for medically unnecessary 

services. 

13  Two of the ACOs dropped out  before 2014, leaving three in 2014 and 2015. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3     
and Improving Quality  (OEI-02-15-00450) 
   
   
Quality  Measures 
In the first 3 years of the program, ACOs were required to report to CMS 
data on 33 quality measures.14   These measures are organized into four 
broad domains.  See Exhibit 2. 
Exhibit 2:  ACO Quality  Measure Domains  
 
Patient/Caregiver Experience: Contains measures related to patient satisfaction 
and engagement with their doctors and care providers.  
 
Care Coordination/Patient Safety: Contains measures related to hospital 
readmissions and unplanned admissions for patients with certain conditions.  
 
Preventive Health: Contains measures  related to various types  of wellness  
screenings. 
 
At-Risk Populations: Contains measures related to specific health conditions that 
beneficiaries may be at risk for, such as diabetes. 
 
In addition to reducing spending,  ACOs must meet certain quality 
performance standards to be eligible to receive shared savings  payments.  
In their first  year of  participation, ACOs must submit complete and 
accurate quality data.   Beginning in their second year of participation, 
ACOs must also meet certain performance levels.15  Further, an ACOs 
performance on the quality measures determines the portion of savings it 
may receive.16  CMS assigns a point value for each measure and aggregates 
the points to determine an overall score that can range from  0 to 100.  
Higher quality scores, such as 90 or above, mean that an ACO performed 
well on the majority of  the individual measures and that the ACO will 
receive a higher proportion of the savings.  
                        ____________________________________________________________ 
14 In 2013 and 2014, the 33 measures included 26 individual  measures and 7 measures that 
contributed to  2 composite measures.  For a  description  of  all  measures, see CMS, 
Accountable Care Organization 2015 Program Analysis Quality Performance Standards 
Narrative Measure Specifications, January 9, 2015.  Accessed at 
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/sharedsavingsprogram/Downloads/ACO-NarrativeMeasures-Specs.pdf on 
March  8, 2017. 
15 CMS does not  assess ACOs on their performance on the measures in their first year.  
Instead, it gives ACOs an  overall quality score of 100 if they submit complete and  
accurate quality data. CMS calculates an overall quality score for the second and third  
years. In the second and third years, ACOs must also  submit complete and accurate data 
and meet the  minimum performance level30th  percentilefor certain measures to be  
eligible to receive shared savings payments.  See 42 CFR   425.502.   
16 Each ACO is accountable for the quality of care for their assigned beneficiaries based on  
the selected quality measures, even  if some of the care is provided outside of the ACO. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         4     
and Improving Quality  (OEI-02-15-00450) 
   
   
Related OIG Work  
OIG is currently conducting a review of beneficiary assignments to Shared 
Savings Program  ACOs.17  OIG is also reviewing the extent to which ACOs 
use health information technology to enhance their care coordination 
goals.18  
METHODOLOGY 
Scope 
This study reviews all of the ACOs that participated in the Shared Savings 
Program in the first 3 years of the program.  It determines the extent to 
which these ACOs reduced spending and improved quality during that 
period. It also describes spending and utilization of high-performing ACOs 
compared to other Shared Savings Program  ACOs and the national average 
for fee-for-service providers from 2010 to 2015.  
Data Sources and Methods 
We based this study on the following data provided by CMS: (1) Shared 
Savings Program performance year results, by ACO, for each of the 3 years 
related to cost savings and quality; (2) spending and utilization summary 
data, by service, for each ACOs performance years and benchmark years; 
(3) summary data on average spending and utilization for all fee-for-service 
providers each year; and (4) provider and beneficiary data.    
We combined these data files and analyzed these complex sets of data to 
provide new  information on key areas of spending, utilization of services, 
and quality.  Appendix A provides a detailed description of the  
methodology. 
Description of ACOs.  We analyzed CMSs beneficiary data from  multiple 
sources to determine the total number of beneficiaries in ACOs and other 
beneficiary characteristics. We analyzed CMS provider data to determine 
differences among ACOs in their composition and  in their provider-to-
beneficiary ratios. 
Analysis of spending.  We analyzed CMSs performance year results to 
identify reductions in Medicare Parts A  and B spending (hereafter referred 
to as Medicare spending) for the first 3 years of the program. We 
determined the number of ACOs that reduced spendingrelative to their 
benchmarkin at least 1 of the 3 years.  CMS calculates a risk-adjusted 
benchmark for each ACO by determining the average annual spending per 
beneficiary and adjusting for beneficiary health status.  CMS further adjusts 
                        ____________________________________________________________ 
17 OIG,  A-09-17-03010,  Forthcoming. 
18 OIG, OEI-01-16-00180, Forthcoming.   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         5     
and Improving Quality  (OEI-02-15-00450)  
   
   
this amount for factors such as projected growth in Medicare fee-for-
service spending.  We then determined the number of ACOs that exceeded 
their benchmarks in all of the years they were in the program.  We  also  
determined the extent to which ACOs reduced spending enough to receive 
a portion of the savings. 
Analysis of quality measures.   We analyzed CMSs data on the 33 quality 
measures to determine the extent to which ACOs improved quality in the 
first 3 years of the program.  Data for the quality measures come  from 
patient surveys, Medicare claims, and clinical data that are reported by the 
ACOs.  We determined whether ACOs overall quality scores and the 
scores on individual measures improved over time.  We also compared 
ACOs performance on the quality measures to Medicare fee-for-service 
providers. 
Analysis of Medicare spending and utilization. We analyzed CMSs 
spending and utilization data to determine the extent to which high-
performing ACOs reduced Medicare spending and made changes to 
utilization for seven key services.19  We defined high-performing ACOs as 
ACOs that had both reductions in spending and high quality scores (an 
overall quality score of 90 or above) in 2014, 2015, or in both years.  We 
determined average spending and utilization rates for key services from  
2010 to 2015.  These years encompass the 3 years prior to the ACOs 
contract period and the 3 performance years.  We then compared the results 
for 58 high-performing ACOs to 122 other Shared Savings Program ACOs 
and to the national average for Medicare fee-for-service providers.20    
Limitations 
We did not independently verify the original data that CMS provided on 
spending, utilization, shared savings, and the quality scores that we used in 
our analyses.  For the purposes of this report, we defined high-performing 
ACOs based on CMSs method for measuring reductions in Medicare  
spending and quality in the Shared Savings Program.  We recognize that 
other Shared Savings Program  ACOssuch as those that had consistently 
low spending or had efficiencies in utilization prior to becoming an ACO 
may also be high-performing ACOs.  Additionally, we recognize that  
changes in spending relative to each ACOs benchmark may not accurately 
reflect what Medicare would have paid in the absence of the Shared 
Savings Program.   
                        ____________________________________________________________ 
19 These services included hospital inpatient care, skilled  nursing  facility (SNF) care, home 
health care, durable medical equipment, hospice care, Part B services, and hospital 
outpatient care.  
20 The 122 other ACOs  are those that participated in the Shared Savings Program for all 
3 years  and did  not  have both reductions in  spending and  high-quality scores in 2014,  
2015, or in both years. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         6     
and Improving Quality  (OEI-02-15-00450)  
   
   
Lastly, the data on spending and utilization are not risk-adjusted based on 
beneficiaries health status.  However, we determined that beneficiaries  
health status remained relatively similar over time for high-performing 
ACOs and for other ACOs from 2010 to 2015.21    
Standards 
This study was conducted in accordance with the  Quality Standards for 
Inspection and Evaluation issued by the Council of the Inspectors General 
on Integrity and Efficiency. 
   
                        ____________________________________________________________ 
21  We based this  analysis on CMSs Hierarchical Condition Categories  risk scores for each 
ACO for each enrollment category (i.e., ESRD, disabled, aged and  dually-eligible for  
Medicare and  Medicaid, and  aged  and Medicare-only).  For high-performing ACOs, the 
median risk scores changed from  1.16 to 1.12 in  the disabled category  and from 1.07 to  
1.06 in the aged and dually-eligible category.  There were no changes over  time in the 
median risk scores for the other two categories.  For the other  ACOs, there were no 
changes  over time in the median risk scores for  any  of the four categories. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         7     
and Improving Quality  (OEI-02-15-00450)  
   
   
FINDINGS 
In the first 3 years of the program, a total of 428 ACOs 
served 9.7 million beneficiaries 
A total of 428 ACOs participated in the Shared Savings Program  from  
2013 to 2015. The number of ACOs grew over time, with 220 ACOs  
participating in the first year, increasing to 333 in the second year, and 392 
in the third year.  A total of 36 ACOs dropped out of the program in the 
first 3 years. 
The number of Medicare beneficiaries served by ACOs also grew in the 
first 3 years of the program.  In 2015, ACOs served 7.3 million  
beneficiaries, up from 3.7 million in 2013.22  This amounted to 19 percent 
of all Medicare beneficiaries in 2015, compared to 10 percent in 2013.23  In 
total, ACOs served 9.7 million unique beneficiaries over the first 3 years.  
The average number of beneficiaries that each ACO served also increased 
over time.  Each ACO served an average 18,500 beneficiaries in 2015, 
compared to 16,700 in 2013.   
ACOs were more likely to serve Medicare beneficiaries in certain States 
more than others.  They served as few as less than 1 percent of  
beneficiaries in Hawaii and as many as 49 percent of beneficiaries in 
Vermont in 2015.  ACOs were more likely to serve beneficiaries in States  
along the East Coast and in parts of the Midwest.  See Exhibit 3.   
                        ____________________________________________________________ 
22 The number of  beneficiaries served by  ACOs is the total  number of beneficiaries who 
were assigned to each ACO at the end of the performance year.  
23 This includes all beneficiaries who received Medicare fee-for-service; it  does not  
include beneficiaries enrolled in Medicare  Advantage.   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         8     
and Improving Quality  (OEI-02-15-00450)  
   
   
Exhibit 3: Proportion of Medicare Fee-for-Service Beneficiaries Served by ACOs, 2015 	

Source: OIG analysis of Medicare fee-for-service beneficiary  enrollment data, 2017.  
 
The composition of ACOs also changed over the 3 years.  The percentage 
of ACOs that were made up solely of physicians decreased, as more ACOs 
began including other entities such as hospitals and nursing homes.  In 
2013, 42 percent of ACOs were made up solely of physicians; this 
decreased to 34 percent of ACOs in 2015.  Of the ACOs that were made of 
both physicians and other entities, 75 percent included hospitals in 2015.  
These ACOs also commonly included home health agencies (39 percent), 
followed by nursing homes (33 percent), and hospices (32 percent).  See 
Exhibit 4. 
 
 
 
 
 
 
 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         9     
and Improving Quality  (OEI-02-15-00450)  
   
   
 
                 Exhibit 4: ACO Composition, 2015 
 
                                               All ACOs                         Subset of ACOs with non-physician entities   
 
 
 
 
 
  34% 
34%  
 
 
 
66% 
 
 
 
 
 
 
     
 
 
 
                                                         Source: OIG analysis of Medicare provider data, 2017.  
 
 
In addition, ACOs made available more primary care physicians and 
specialists to their beneficiaries over time.  In 2015, ACOs had 1 primary 
care physician for every 166 beneficiaries, compared to 1 primary care 
physician for every 178 beneficiaries in 2013.  Similarly, ACOs had 
1 specialist for every 463 beneficiaries in 2015, compared to 1  specialist for 
every 611 beneficiaries in 2013. 
Most ACOs were able to reduce Medicare spending
over the first 3 years of the program; the net reduction 
in spending across all ACOs was about $1 billion 
To determine if an ACO reduced Medicare spending, CMS compares each  
ACOs spending during the performance year to a benchmark.24  This 
benchmark is calculated largely based on historical spending with 
adjustments for other factors, such as beneficiary health status.25  During 
the first 3 years of the program, two-thirds of all ACOs (282 of 428) 
reduced spending for at least one of the years they participated in the 
program.  The remaining ACOs (146) had spending that exceeded their 
benchmarks for each of the years they were in the program.  These ACOs 
were not able to reduce spending below their benchmarks.  
 
 
                        ____________________________________________________________ 
24 Throughout this report, we refer  to ACO spending for Medicare Parts A and B services 
as Medicare  spending.   
25 CMSs calculations of  historical spending are based  on claims data. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  0  
and Improving Quality  (OEI-02-15-00450) 
   
   
Fifty-seven percent of ACOs that 
were in the program for 3 years were  ACOs that were in the 
able to reduce spending in 2015,  program longer were 
compared to 46 percent of ACOs that 
more likely to reduce 
were in the program for 1 year.  In 
spending and by 
addition, ACOs that were in the 
program  for 3 years reduced  greater amounts.   
spending by an average of $10.1 
million per ACO in 2015, compared 
to $5.4 million per ACO for those that were in the program for 1 year.  This 
suggests that more established ACOs are learning how to achieve greater 
cost savings over time.   
In total, ACOs reduced spending by $3.4 billion in the first 3 years of the 
program.  There was significant variation in the reductions achieved by 
these ACOs.  About half of the spending reductions$1.7 billionwas 
generated by just 36 ACOs.  Three ACOs in that group generated a quarter 
of that amount.  
At the same time, the ACOs that exceeded their benchmarks increased 
spending by a total of $2.4 billion in the first 3 years of the program.  
About half of that amount was generated by 38 ACOs.   
The net reduction in spending across all ACOs was nearly $1 billion in 
savings in the first 3 years.  Over time, the net spending reductions grew.  
Overall, ACOs reduced spending by a net amount of $234 million the first 
year, increasing to $429 million by the third year.  See Exhibit 5.   
 
Exhibit 5: ACOs Medicare Spending Above and Below  Their Benchmarks,                    
2013 to 2015  (in millions)   
Net: $429 
Net:  $291  
 ) Net: $234   $1,568 
s
n
o
milli $975  $1,139 
$833 
n  $683 
(i $599 
s 
r
a
oll
D
2013  2014  2015 
Spending below the benchmark  Spending above the benchmark 
 
Source: OIG analysis of ACO spending data, 2017. 

Note:  The  net amount for 2014 does not equal the  difference between the total reduced spending 

amount and the total increased spending amount due to rounding.
	  
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  1   
and Improving Quality  (OEI-02-15-00450) 
   
   
One-third of ACOs earned $1.3 billion in shared savings 
payments 
ACOs that reduce spending below a certain amount are eligible to receive a 
portion of the savings.26  Over the first 3 years of the program, 154 ACOs 
(one-third of  all ACOs) reduced spending enough to receive a portion of 
the savings in at least 1 year.27  In total, these ACOs reduced spending by 
$2.8 billion from 2013 to 2015. 28  Of that amount, the ACOs received 
$1.3 billion in shared savings payments.    
On average, each of these ACOs received a payment of approximately 
$4.8 million  for every year that they earned shared savings.  ACOs have 
flexibility in how they use their portion of the savings.  For example, some 
may opt to make changes to providers electronic medical records systems, 
invest in new care programs or interventions, or provide incentives to 
providers to improve quality.  
For each of the 3 years, ACOs that 
ACOs that received 
received payments had higher 
benchmarks, on average, than ACOs that  shared savings 
did not receive payments.  Notably, in  payments had 
2015, the average benchmark for the 
higher benchmarks, 
ACOs that received payments was 
on average. 
$11,748 per beneficiary compared to 
$10,284 per beneficiary for the ACOs 
that did not receive payments.  ACOs with higher benchmarks may have 
greater opportunities to reduce unnecessary costs than ACOs that have 
lower benchmarks. 
Overall, ACOs improved quality  in the first 3 years of 
the program 
Each ACO receives an overall quality score based on its performance on 
the individual quality measures.  ACOs average overall quality score 
increased from  the second to the third year of the program.29  In 2014, 
ACOs had an average overall quality score of 86, which increased to 91 in 
                        ____________________________________________________________ 
26 As noted earlier, an ACO must meet a minimum  savings rate and quality performance 
standards set by CMS to receive a portion of the savings.   
27 An  additional 11 ACOs met the minimum  savings rate but did not meet the quality 
performance standards to receive a portion of the savings.    
28 Only one ACO  increased its spending  above the minimum  loss rate and had to pay a  
portion of its loss to CMS.  This ACO was one of the five ACOs  that participated in Track 
2; it  had to  pay CMS $4 million  in  2013.   
29 CMS reviews an  ACOs performance on the individual quality measures in its second  
and third  year of the program  to calculate an overall quality score.  We therefore based  our 
analysis on only  ACOs in their second and third year of the program.  In addition, in 2015, 
ACOs could earn additional points for quality improvement. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  2   
and Improving Quality  (OEI-02-15-00450) 
   
   
2015. As shown in Exhibit 6, the largest shifts in average scores were 
between 85 and 100.  Notably, a much higher percentage of ACOs 
achieved a score of 90 or above29 percent in 2014 compared to 
74 percent in 2015. 
 
 Exhibit 6: ACOs Quality  Scores, by  Year 
40% 
38% 
2014  2015  36% 
 s
O
C 28% 
A
f 
o
e 
g
ta 16%  16% 
n
e
c 11% 
r
e
P
4% 4%  4% 
2%  1% 
174  7579  8084  8589  9094  95100 
Quality Score Ranges 
 
 
Source: OIG analysis of ACO quality  data, 2017. 
 
ACOs performance on individual quality measures improved 
over time   
In the first 3 years of the program, ACOs improved their performance on 
82 percent (23 of 28) of the individual quality measures.30 ACOs showed 
the most improvement on two measures.  ACOs increased the percentage 
of beneficiaries who were screened for depression from  a median of 
26 percent in 2013 to 46 percent in 2015.  ACOs also increased the 
percentage of beneficiaries who were screened for fall risk from a median 
of 35 percent in 2013 to 59 percent in 2015.  As shown in Exhibit 7, ACOs 
also improved on several other measures.  Appendix B provides additional 
information on individual quality measures.  
 
 
                        ____________________________________________________________ 
30  We based this  analysis on  26  individual  measures and 2 composite measures that 
represented the  remaining 7 measures.  We  analyzed the data for the most recent year 
available for each measure. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  3   
and Improving Quality  (OEI-02-15-00450)  
   
   
Exhibit 7: Most Improved Quality  Measures  
       
 	 Depression Screenings and Followup Plan 
 
    		  Screenings for Future Fall Risk 
 
 	 Primary  Care Physicians Qualifying for electronic  health record 
(EHR) Incentive Payment 
 
 	 Pneumococcal Vaccination 
 
    		 Body Mass Index Screening and Followup 
Source: OIG analysis of ACO quality data, 2017.   
 
In contrast, ACOs performance declined on five measures.  They declined 
slightly on four measures related to patient experiences.31  ACOs had a 
larger decrease on a fifth measure; the percentage of beneficiaries who 
received a blood pressure screening with any necessary followup declined 
from a median of 86 percent in 2013 to 74 percent in 2015.32    
ACOs performed better than fee-for-service providers on most 
quality measures; ACOs also showed improvement over time 
On average, ACOs outperformed fee-for-service providers on 81 percent 
(22 of 27) of the individual quality measures.33  Notably, ACOs performed 
better than 90 percent of all fee-for-service providers in terms of low 
hospital readmissions.  ACOs also performed better than 80 percent of fee-
for-service providers on three measures.  See Exhibit 8 for all these  
measures.  Appendix C provides additional information on individual 
quality measures relative to fee-for-service providers.  
   
                        ____________________________________________________________ 
31 Overall performance on these measures was high, with median scores ranging from  
80 percent to  93 percent in 2015. 
32 This decline may be partly explained by a  change in the definition for the measure. 
33  We based this  analysis on  27  measures that had at least 2 years of data that also had  
comparable data for fee-for-service providers.  We analyzed the data for the most recent 
year available for each measure.   We  considered ACOs to  outperform  fee-for-service 
providers if the median score  for all ACOs exceeded the 50th percentilethe median  
scorefor all fee-for-service providers. 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  4   
and Improving Quality  (OEI-02-15-00450) 
   
   
Exhibit 8: Quality  Measures in Which ACOs Outperformed at Least   
80 Percent of Fee-for-Service Providers  
    
         Hospital Readmissions 
 
        Screenings for Future Fall Risk 
 
       Primary Care Physicians Qualifying for EHR Incentive Payment
 
   Depression Screenings and Followup Plan 
 
Source: OIG analysis of ACO quality data, 2017. 
 
ACOs also performed better than fee-for-service providers on an increasing 
number of measures over time.  Specifically, ACOs performed better than 
fee-for-service providers for 73 percent of measures in 2013, 77 percent of 
measures in 2014, and 86 percent of measures in 2015.34  
High-performing ACOs reduced Medicare spending for 
key  services and made cost-effective changes in 
utilization  
A small subset of ACOs showed substantial reductions in Medicare 
spending for key services.  These ACOs, which we refer to as high-
performing ACOs, had been in the program for all 3 years and had both 
reductions in spending and high quality scores (an overall quality score of 
90 or above) in 2014, 2015, or in both years.35  
On average, high-performing ACOs reduced Medicare spending per 
beneficiary, while other Shared Savings Program ACOs and fee-for-service 
providers nationally (i.e.,  the national average) increased average per 
beneficiary spending.  From  2010 to 2015, high-performing ACOs reduced 
spending by an average $673 per beneficiary for key services, while other  
ACOs increased spending by $707 per beneficiary.36  Nationally, fee-for-
service providers also increased spending by an average of $673 per 
beneficiary.  In addition, high-performing ACOs reduced spending more 
than other ACOs that saved but did not score high on quality.   For more 
                        ____________________________________________________________ 
34  We based this  analysis on the 22 measures that  existed in all  3 years that had 
comparable data for fee-for-service providers. 
35  We based this analysis on 58 high-performing ACOs.  These ACOs met the minimum  
savings rate.  To determine if  ACOs  reduced spending, we compared each ACOs 
performance year spending to its benchmark year spending.  CMS calculates a spending 
benchmark based on the 3 years immediately prior  to the contract  period.  
36 The data on spending and utilization  are not risk-adjusted  based on beneficiaries health 
status. However, we determined that beneficiaries health status remained relatively  
similar over  time for  high-performing ACOs and  for  other  ACOs  from  2010 to 2015.  
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  5   
and Improving Quality  (OEI-02-15-00450) 
   
   
information on how these ACOs compared to high-performing ACOs, see  
Appendix D. 
As shown in Exhibit 9, high-performing ACOs had higher average 
spending per beneficiary for 5 of the 6 years compared to other ACOs and 
to the national average.37  At the same time, they exhibited greater 
reductions in overall spending, and in 2015 their spending was lower than  
other ACOs. 
Exhibit 9: Average Total Spending per Beneficiary  for Key  Services,  
2010 to 2015   
$12,000 
$11,500 
 y
r $11,000 
a
ci
fi $10,500 
e
n
e
B $10,000 
r 
e
p $9,500 
s 
r
a $9,000 
oll
D Benchmark Years   Performance  Years  
$8,500 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
  
Source: OIG analysis of ACO spending data, 2017.   
 
High-performing ACOs reduced spending for five of the seven types of 
services we reviewed.  Their largest average spending reductions were 
in hospital inpatient care, followed by skilled nursing facility (SNF) 
care, home health care, durable medical equipment, and hospice care, 
respectively. Further, they made greater reductions in each of these 
services than other ACOs and the national average.  For the remaining 
two types of serviceshospital outpatient care and Part B services 
high-performing ACOs had the lowest increases compared to other  
ACOs and the national average.  See Exhibit 10.  See Appendix E for 
more detailed information about the average spending per beneficiary 
for each service over time. 
   
                        ____________________________________________________________ 
37 The national average includes beneficiaries who did not receive any primary care 
services, which is a requirement for beneficiary assignment to ACOs.  According to CMS, 
average total  per capita spending for ACO assignable beneficiaries has  historically been 
about  9 to 10 percent  higher than average fee-for-service spending overall. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  6   
and Improving Quality  (OEI-02-15-00450)  
   
   
Exhibit 10: Changes in Average Spending per Beneficiary  for Key Services,  
2010 to 2015  
  Change in Average  Change in Average  Change in Average 
Spending: High- Spending:             Spending: National 
Performing ACOs   Other  ACOs   Fee-for-Service  
Total    ($673)*     $707*     $673  
Hospital Inpatient Care   ($549)   ($76)   ($32)  
Skilled Nursing Facility  Care   ($287)  $25  $35 
Home Health Care   ($198)   ($21)   ($46)  
Durable Medical Equipment  ($71)   ($50)   ($50)  
Hospice Care   ($44)   $11  $28 
Part B Services  $120   $303   $245  
Hospital Outpatient Care   $355   $516   $493  
Source: OIG analysis of ACO spending data, 2017. 
*Totals do not equal the  sum of the  rows due to rounding.  
High-performing ACOs had the most significant reductions in 
in-patient hospital care and skilled nursing facility care 
High-performing ACOs had the largest spending reductions in hospital 
inpatient care compared to the other services.  In 2010, they spent an 
average of $3,872 per beneficiary for these services, and by 2015 they 
reduced spending to $3,324, representing a decrease of $549 per  
beneficiary. Other ACOs reduced their spending in this area by only a 
fraction of that amount ($76 per beneficiary), and the national average 
declined by only $32 per beneficiary.  See Exhibit 11.  
 
Exhibit 11: Average Spending per Beneficiary  for Hospital Inpatient Care, 
2010 to 2015  
 $3,900 
 $3,800
 $3,700
 y
r
cia  $3,600
fi
e  $3,500
n
e
B  $3,400
r 
e
p  $3,300
s 
r
olla  $3,200
D
 $3,100
 $3,000
BeBnecnhcmhmarakr kY eYaerasr s   PPeerrffoorrmmaannccee   YYeeaarrss   
$2,900
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
  
Source: OIG analysis of ACO spending data, 2017.
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  7   
and Improving Quality  (OEI-02-15-00450)  
   
   
 
Both high-performing ACOs and other ACOs had higher hospital 
admission rates compared to the national average for all 6 years.  This is 
likely because beneficiaries in ACOs are older and have more risk factors 
than the general fee-for-service population.  However, high-performing 
ACOs had the largest decline in admissions.  These ACOs had higher 
hospital admissions rates than other ACOs for all years until 2015, when 
they had the same average rate.  See Appendices F and G for changes in 
hospital admission rates and for changes in the utilization of other key 
services. 
In addition, high-performing ACOs were the only group that had reductions 
in average spending for SNF care.  They decreased spending by almost 
$287 per beneficiary.  Other ACOs increased their spending in this area by  
$25 per beneficiary, and the national average increased by $35 per 
beneficiary. See Exhibit 12. 
 
Exhibit 12: Average Spending per Beneficiary  for Skilled Nursing Facility 
Care, 2010 to  2015  
 $1,200 
 $1,100
 y
r
a
ci
fi
e  $1,000
n
e
B
 r
e
p  $900
 s
r
a
oll
D  $800 Benchmark Years  Performance Years 
Benchmark Years   Performance  Years  
$700
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
Source: OIG analysis of ACO spending data, 2017. 
 
High-performing ACOs also decreased SNF admissions rates by 16 percent 
between 2013 and 2015, compared to a decrease of 7 percent for other 
ACOs and a decrease of 4 percent for the national average.  This trend 
resulted in high-performing ACOs having the lowest SNF admissions rates 
by 2015, compared to the other groups. 
 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  8   
and Improving Quality  (OEI-02-15-00450)  
   
   
High-performing ACOs maintained high use of primary care 
and reduced the use of costly services  
By 2015, high-performing ACOs made more cost-effective changes in 
service utilization compared to other ACOs and the national average.  
Adequate primary care can be a cost-effective tool, leading to lower 
utilization and lower costs of care.38  High-performing ACOs provided the 
highest number of primary care visits (10.6 per beneficiary) in 2015 
compared to other ACOs (10.1 per beneficiary) and the national average 
(8.6 per beneficiary).  In addition, high-performing ACOs were the only 
group to reduce the number of emergency department visits per beneficiary 
(a reduction of 1 percent) and had the highest reduction in the use of costly 
CT scans (a reduction of 17 percent). 
High-performing ACOs had somewhat different characteristics  
than other ACOs  
High-performing ACOs served a larger number of beneficiaries in 2015, 
averaging 22,000 beneficiaries compared to 19,000 for other ACOs.  In 
addition, they were more likely to include only physicians.  In 2015, about 
45 percent of high-performing ACOs were made up solely of physicians, 
compared to 36 percent for other ACOs.  
In addition, beneficiaries served by high-performing ACOs typically had 
more health conditions and other risk factors associated with higher 
spending compared to other ACOs. Further, beneficiaries served by both 
high-performing ACOs and other ACOs were generally older and had more 
health conditions and other risk factors associated with higher spending 
than the broader Medicare fee-for-service population.39  This likely 
contributed to high-performing ACOs having higher average spending per 
beneficiary compared to other ACOs and the national average. 
   
                        ____________________________________________________________ 
38 Mark W. Friedberg, Peter S.  Hussey, and Eric C. Schneider, Primary Care: A Critical 
Review of the Evidence on Quality and  Costs of Health Care, Health Affairs, May 2010. 
Accessed at http://content.healthaffairs.org/content/29/5/766.full  on  March 20, 2017.  
39 Note that the broader Medicare fee-for-service population includes beneficiaries who 
did not receive primary care services, which is a requirement for beneficiary assignment to 
ACOs.   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         1  9   
and Improving Quality  (OEI-02-15-00450)  
   
   
CONCLUSION 
The Shared Savings Program is one of the largest alternative payment 
models in Medicare.  The program rewards providers for improving care 
and reducing growth in costs.  In the first 3 years of the program, ACOs in  
the Shared Savings Program have shown potential for reducing spending 
and improving quality of care.    
Over the first 3 years of the program, 428 ACOs participated in the 
program and served 9.7 million beneficiaries.  During that time, most of 
these ACOs reduced Medicare spending, with a net spending reduction of 
nearly $1 billion.  One-third of ACOs  reduced spending enough to receive 
a portion of the savings. ACOs participating in the program longer were 
more likely than other ACOs to reduce spending and by greater amounts.  
This suggests that more established ACOs are learning how to achieve 
greater cost savings over time.  
At the same time, ACOs generally improved the quality of care they 
provided.  In the first 3 years, ACOs improved their performance on most 
(82 percent) of the individual quality measures.  ACOs also outperformed 
fee-for-service providers on most (81 percent) of the quality measures.   
Further, a small subset of ACOs showed substantial reductions in Medicare 
spending while providing high-quality care.  These high-performing ACOs 
reduced spending by an average of $673 per beneficiary for key Medicare 
services during the review period.  This included significant spending 
reductions for high-cost services such as inpatient hospital care and SNF 
care.  These ACOs also maintained high use of primary care services, 
which can lower utilization and costs for other care, and reduced the use of 
costly services such as emergency department visits.  In contrast, other 
Shared Savings Program ACOs and the national average showed an 
increase in per beneficiary spending for key Medicare services.  
With any major payment reform, time may be needed for organizations to 
make changes to improve quality and lower costs.  While policy changes  
may be warranted, ACOs show promise in reducing spending and 
improving quality.  High-performing ACOs produced substantial spending 
reductions for high-cost services while providing high-quality  care.  
Additional information about high-performing ACOs and their specific 
strategies is needed.  To help in this effort, OIG is conducting an additional 
evaluation of high-performing ACOs and the different strategies they 
employ to achieve Medicare spending reductions and quality 
improvements.  Understanding the success of such ACOs can inform not 
only the future direction of the Shared Savings Program, but also other 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  0   
and Improving Quality  (OEI-02-15-00450)  
   
   
alternative payment models that seek to achieve high-quality care for lower 
costs.  
   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  1  	

and Improving Quality  (OEI-02-15-00450)
	 
   
   
APPENDIX A 
Detailed Data Sources and Analysis    
We based this study on CMS data for ACOs in the Shared Savings Program  
for the first 3 years of the program.  We analyzed several data sources to 
describe ACOs that participated in the program for the first 3 years of the 
program.  We also analyzed several data sources from  CMS to determine 
ACOs savings and quality in the first 3 years of the program as well as 
their spending on and utilization of key services.   
Description of ACOs.  We analyzed CMSs data to describe key 
characteristics of ACOs in the Shared Savings Program.  We first 
determined the number of ACOs that participated in each of the  first  
3 years of the Shared Savings Program.40   
Next, we analyzed data from  CMSs Shared Savings Program ACO 
beneficiary-level research identifiable files (beneficiary RIF) to determine 
the unique number of final-assigned beneficiaries that ACOs served in the 
first 3 years of the program.  Using CMSs Shared Savings Program ACO 
Performance  Year Results files, we determined the number of final-
assigned beneficiaries served by ACOs in each of the 3 years. 
Using the Performance Year Results files, we calculated the proportion of 
the Medicare fee-for-service population that beneficiaries served by ACOs 
represented in each of the 3 years.41 Using the beneficiary RIF, we 
determined the proportion of the fee-for-service population that 
beneficiaries served by ACOs represented in each State.  To do this, we 
matched each final-assigned beneficiarys Health Insurance Claim Number  
(HICN) from the beneficiary RIF to the HICN from  CMSs Integrated Data 
Repository (IDR) to identify each beneficiarys State of residence in 2015.   
Next, we analyzed the composition of ACOs.  We first analyzed data from 
CMSs Shared Savings Program ACO provider-level research identifiable 
files (provider RIF) to determine the proportion of ACOs that were made 
up solely of physicians and the proportion that were made up of physicians 
and other entities in each year.  We then matched the Tax Identification 
Numbers (TIN) of the providers in the provider RIFs to the TINs in the 
                        ____________________________________________________________ 
40 The number of participating  ACOs is based on ACOs  that had at least 1 year of 
performance data. 
41 The Medicare  fee-for-service beneficiary data are from  the Medicare Enrollment 
Dashboard, available at:  
https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-
Reports/Dashboard/Medicare-Enrollment/Enrollment%20Dashboard.html. 
Accessed on March 9, 2017. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  2   
and Improving Quality  (OEI-02-15-00450)  
   
   
IDR to identify the other types of entities they included, such as hospitals, 
SNFs, and home health agencies.  
Lastly, we analyzed the ratios of primary care physicians and specialists to 
beneficiaries.  We based this analysis on the provider data in CMSs Shared 
Savings Program ACO Public Use Files (PUF) and beneficiary totals in the 
Shared Savings Program ACO Performance Year Results files.  We  
conducted this analysis for each ACO for each of the 3 years.   
Analysis of spending.  We determined the extent to which ACOs reduced 
Medicare spending based on data from the Shared Savings Program ACO 
Performance  Year Results files for the first 3 years of the program.  
We determined the number of ACOs  that reduced spendingrelative to 
their benchmarkin at least 1 of the 3 years.42  We then determined the 
number of ACOs that exceeded their benchmarks in all of the years they 
were in the program.  To determine whether ACOs that had been in the 
program longer were more likely to reduce spending and by larger 
amounts, we grouped ACOs by their start year and calculated the  
proportion that spent below their benchmark in 2015 for each group.43    
In addition, we determined the total amount that ACOs spent below their 
benchmark by year and for all 3 years, as well as the total amount that 
ACOs spent above their benchmark by year and for all 3 years.  We then 
calculated the net difference between these two amounts by year and for all 
3 years.  We also determined the extent to which certain ACOs generated a  
large proportion of the spending reductions.  
Next, we determined the extent to which ACOs reduced spending enough 
to receive a portion of the savings.  To do this, we calculated the number of 
ACOs that had both reduced spending enough to meet the minimum 
savings rate and the quality performance standards in any of the 3 years.  
We then calculated the portion of savings that these ACOs received.  We 
determined the average amount of shared savings payments that these 
ACOs received per year.  We also determined the number of ACOs in each 
year that participated in Track 2 that incurred shared losses and the amount 
of the shared losses. 
Lastly, we determined whether ACOs that received shared savings  
payments were more likely to have higher benchmarks compared to ACOs 
that did not receive these payments.  To do this, we calculated the average 
benchmark for ACOs that received shared savings payments and the 
                        ____________________________________________________________ 
42 CMS calculates this benchmark for each ACO by determining the  average  annual  
spending per  beneficiary  over  the 3 years  immediately prior to the  ACOs contract period.  
43 The ACOs that started in 2012 or 2013 had  their  first performance year in 2013, so we  
grouped these ACOs together.  
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  3   
and Improving Quality  (OEI-02-15-00450)  
   
   
average benchmark for ACOs that did not receive shared savings payments 
for each year. 
Analysis of quality measures.   We determined the extent to which ACOs 
improved quality over the first 3 years of the program.  We based this 
analysis on CMSs data on the 33 quality measures from  the Shared 
Savings Program Performance Year Results files.44    
We first determined whether their overall scores improved over time.45  We 
analyzed the overall quality scores for a total of 206 ACOs in 2014 and 
303 ACOs in 2015.46  For each of the years, we calculated the average 
overall score and the proportion of ACOs that that had an overall score of 
90 or above in each year.  
In addition, we determined whether ACOs scores on the individual  
measures improved over time and which measures improved the most.47    
We calculated the median scores for 28 measures.  In total, 23 of the 
measures existed for all 3 years, and 5 of the measures existed in 2013 and 
2014 only.  We calculated the percent change between 2013 and the most 
recent year available for the median scores for each measure.  
Lastly, we compared ACOs performance on the quality measures to 
Medicare fee-for-service providers.  First, we determined the proportion of 
measures for which ACOs outperformed fee-for-service providers. To do 
this, we converted the median scores  for each measure to the corresponding 
percentiles  for all Medicare fee-for-service providers.48  We analyzed the 
most recent year of data available for each measure and included 
                        ____________________________________________________________ 
44 Data for the quality measures come from patient surveys, Medicare claims, and clinical  
data that  are reported by  the ACOs.  
45 CMS assigns points to each measure based on an ACOs  performance on the measure.  
These points are then used to  calculate an  overall quality score. 
46 CMS does not  assess ACOs  on  their  performance on individual  measures in their first 
year of the  program.  ACOs receive an overall quality score of 100  during that time if they 
submit complete and accurate quality data.  We did not include  these ACOs in our  
analysis.  Nor did we include ACOs  that  had a score of 0 in the overall quality score.  
These ACOs did not  provide CMS with complete and accurate quality data.   
47 We analyzed 26 individual measures and  2 composite measures representing the 
7 remaining measures.  We  chose to analyze the composite measures rather than the  
individual measures that comprise the composite measures because the composite 
measures are used  in the calculation  of the overall quality score and they  allow for 
comparison to fee-for-service providers.  
48 CMS provided fee-for-service percentiles for each of the  measures.  It uses these  
percentiles to compare ACOs to fee-for-service providers when it calculates ACOs 
overall quality scores.  CMS provided the fee-or-service data as deciles between the 30th 
and 90th percentile.  For some of the measures in each year, CMS recalculated the 
percentile so that the scoring reflects the same number as the percentile (i.e., the 30th 
percentile represented a score of 30).  Rather than using  these, we used the actual 
percentiles that CMS provided  to us for these measures. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  4   
and Improving Quality  (OEI-02-15-00450)  
   
   
27 measures in this analysis.49  We considered ACOs to have outperformed 
fee-for-service providers in a measure if the median for all ACOs exceeded 
the 50th percentilethe median scorefor all fee-for-service providers.  
We also identified the measures for which the median for all ACOs 
exceeded the 80th or 90th percentiles for fee-for-service providers.  Next, 
we calculated the proportion of measures for which ACOs outperformed 
fee-for-service providers in each year.  We based this analysis on the 
22 measures that existed in all 3 years that had comparable data for fee-for-
service providers. 
Analysis of spending and utilization for key services.  We analyzed CMS 
summary data from  the IDR to determine the extent to which high-
performing ACOs reduced spending and made changes to utilization for 
key services compared to other Shared Savings Program ACOs and the 
national average for all Medicare fee-for-service providers.    
We defined high-performing ACOs as those that participated in the 
program for all 3 years and had both reductions in spending and high 
quality scores (an overall quality score of 90 or above) in 2014, 2015, or in 
both years.  Other ACOs included those that participated in the program for 
all 3 years and did not meet this high-performance criteria.   
We determined the extent to which ACOs in each group reduced spending 
for key services.  To do this, we calculated ACOs average spending per 
beneficiary in their benchmark and performance years.  Each ACO starts 
with one set of data for their benchmark years, which represents the 3 years 
prior to becoming an ACO in the Shared Savings Program.  If an ACO has  
any provider changes, CMS calculates an additional set of data for the 
benchmark years for that ACO.  This additional set of data for the 
benchmark years reflects the spending and utilization of services for final-
assigned beneficiaries with the new group of providers.  For each ACO that 
had provider changes, we analyzed changes in spending and utilization 
among the different sets of data for its benchmark years.  We excluded 
from our analysis any ACOs with provider changes resulting in a  
15 percent difference or more in the different sets of data for the 
benchmark years.  We performed this step so that any change in spending 
and utilization that we identified is more likely due to directed efforts by 
the ACOs and less likely due to changes in their providers.  In total, we 
analyzed 58 high-performing ACOs and 122 other Shared Savings Program 
ACOs.  
To determine change in spending and utilization over time, we defined the 
benchmark years from 2010 to 2012 and the performance years from 2013 
                        ____________________________________________________________ 
49 These 27 measures all  had comparable data for fee-for-service providers.  
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  5   
and Improving Quality  (OEI-02-15-00450)  
   
   
to 2015.50  We focused our analysis on total spending for seven services and 
spending for the individual services.51  These services included hospital 
inpatient care, SNF care, home health care, durable medical equipment, 
hospice care, Part B services, and hospital outpatient services.  We  
analyzed utilization rates for the following categories: hospital inpatient 
care, SNF care, emergency department visits, primary care, CT scans, and 
MRI scans.52  
For each ACO and each type of service, we averaged the multiple sets of 
data for the benchmark years for each of the 3 years.  We then determined 
an average for each of the benchmark years and each of the performance 
years for high-performing ACOs and for other ACOs.53  We determined the 
difference in average spending for each group from 2010 to 2015.  We  
compared these results to the national average for fee-for-service 
providers.54    
We conducted a similar analysis on utilization rates for certain services.    
For each service, we calculated the average rates for each of the benchmark 
years and each of the performance years for high-performing and other 
ACOs.  We determined the difference in average utilization for each group 
from 2010 to 2015.  We compared the results to the national average.  
Further, to determine if quality was a possible factor in changes to 
spending, we identified a subset of the 122 other ACOs that saved but 
scored below 90 on quality in a given year (31 ACOs).  We analyzed 
                        ____________________________________________________________ 
50 Benchmark years differ by  ACO, depending  on  when the ACO started its contract 
period.  The ACOs that had their  first performance year in 2013 started in April 2012, July 
2012, or January 2013.  The benchmark years for the ACOs  that started in April or July of  
2012 are 2009, 2010, and  2011, whereas, the benchmark years for the ACOs that started in 
January of 2013 are 2010, 2011, and 2012.  For this study, our  starting point for the 
benchmark years is  2010  rather than  2009 because all  ACOs in our analysis share 2010 as  
a benchmark  year.  In  addition, some ACOs had 2012 as a benchmark year, while others 
had it as a performance year.  We chose to  analyze 2012  as a benchmark year because  
there were more ACOs  with  2012 benchmark year data than ACOs  with 2012 performance 
year data. 
51 The data on spending and utilization  are not risk-adjusted  based on beneficiaries health 
status. However, we determined that beneficiaries health status remained relatively  
similar over  time for  high-performing ACOs and  for  other  ACOs  from  2010 to 2015.  
52 CMS reports the utilization  for all services per 1,000 person years.   We converted the 
rates to utilization  per beneficiary per year.   
53 The SNF utilization  data for benchmark years 2010 through 2012 were incomplete; 
therefore, those years are not  included in the analysis.  
54 CMS provided data on national  averages for fee-for-service providers.  It  also noted that  
there are a  number of reasons why Shared Savings Program per capita spending may differ 
from per capita spending reported for the wider  national  Medicare fee-for-service 
population.  The most pronounced difference is related to the way the program assigns  
beneficiaries to an  ACO.  Since primary care utilization  is necessary for assignment, 
average total per capita spending for assignable beneficiaries has historically been about 
9 to 10 percent  higher than average  fee-for-service spending  overall. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  6   
and Improving Quality  (OEI-02-15-00450)  
   
   
spending changes by the types of services for this group following the same 
method described above.  We compared the results for these ACOsthat 
saved but did not score high on qualityto the results for the ACOs that 
saved and scored high on quality. See Appendix D. 
Lastly, we analyzed the extent to which differences existed between high-
performing ACOs and other ACOs in the average number of beneficiaries  
served per ACO and their composition.  In addition, we analyzed  
beneficiary age and CMSs Hierarchical Condition Categories (HCC) risk 
score data to determine the extent to which differences existed among high-
performing ACOs, other ACOs, and the national average.  We analyzed the 
risk scores for the following enrollment categories: end-stage renal disease, 
disabled, aged with Medicare only, and aged with Medicare and 
Medicaid.55  We also determined any differences in median risk scores over  
time within these categories between high-performing ACOs and other 
ACOs. 
 
   
                        ____________________________________________________________ 
55 The Medicare  fee-for-service beneficiary  data on age comes from  the following CMS 
website: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-
and-Reports/CMS-Statistics-Reference-
Booklet/Downloads/2015CMSStatistics.pdf#page=16. Accessed on March 9, 2017.  The 
Medicare fee-for-service beneficiary data on health is represented by the CMS  
Hierarchical Condition Categories (CMS-HCC) risk  score.  A CMS-HCC risk score of 1  
indicates risk associated with expenditures for the  average beneficiary nation-wide.  A 
beneficiary risk score greater than 1 indicates above-average risk, and a risk score  less 
than 1 indicates below-average risk.  For more information on risk scores, see  
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/PhysicianFeedbackProgram/Downloads/2014-MIF-TPCC.pdf. Accessed on  
March  9, 2017. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  7   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX B 
 
Exhibit B-1: ACOs Performance on Individual Quality  Measures, 2013 to 2015  
  Median  Median  Median     
  Score  Score  Score  Percent   
Description (quality  measure)  2013   2014   2015   Change   Performance 
Patient/Caregiver Experience  
Patients rating  on getting timely care, appointments, and 
information (measure 1)   81.6   80.6   80.3   (1.6%)  Worsened  
Patients rating  on how  well doctors communicate (measure 2)  93.1   92.7   92.7   (0.5%)  Worsened  
Patients rating  of doctor (measure 3)   92.2   91.9   92.1   (0.1%)  Worsened  
Patients rating  on access to specialists (measure 4)   85.3   84.1   83.7   (1.9%)  Worsened  
Patients rating  on doctors promotion and education about  
patients health  (measure 5)   58.1   58.2   59.0   1.7%  Improved  
Patients rating  of shared decision-making  with doctors  
(measure 6)   74.5   74.7   75.0   0.7%  Improved  
Patients self-rating on physical and mental health (measure 7)   71.1   71.3   72.2   1.6%  Improved  
Care Coordination/Patient Safety  
Percent of patients readmitted to a hospital within 30 days 
(reverse scored) (measure 8)    14.9   15.1   14.8   (0.3%)  Improved  
Rate of hospital admissions for patients with chronic obstructive 
pulmonary disease or asthma in older adults (reverse scored) 
(measure 9)   1.1   1.0   1.1   (3.1%)  Improved  
Rate of hospital admissions for patients with heart failure (reverse 
scored) (measure 10)   1.2   1.2   1.0   (14.2%)  Improved  
Percent of primary care physicians who qualified for electronic  
health record incentive payment (measure 11)  69.0   80.5   85.3   23.5%  Improved  
Percent of discharged patients who reconciled their discharge 
medications with their current medication list within 30 days of 
discharge (measure 12)*   87.0   91.7   N/A  5.4%  Improved  
Percent of patients screened for future fall risk (measure 13)  35.1   44.7   58.8   67.5%  Improved  
Preventive  Health 
Percent of patients who received an influenza immunization  
(measure 14)   58.0   58.2   63.2   9.0%  Improved  
Percent of patients who have ever received a pneumococcal 
vaccination (measure 15)   54.2   56.8   66.1   22.1%  Improved  
Percent of patients who received a body mass index screening 
and followup (measure 16)   63.3   67.9   71.9   13.5%  Improved  
Percent of patients screened for tobacco use and who received  
cessation intervention (when appropriate) (measure 17)   89.3   91.3   92.7   3.8%  Improved  
* CMS discontinued the quality  measure in 2015. 
 
Note: The quality measures introduced in 2015 are  not included.
 	
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  8   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX B (CONTINUED)  
 
 
Exhibit B-1:  ACOs Performance on Individual Quality  Measures, 2013 to 2015  
  Median  Median  Median     
  Score  Score  Score  Percent   
Description (quality  measure)   2013   2014   2015   Change   Performance 
Preventive  Health (continued) 
Percent of patients screened for depression and a followup  plan was  
created (when appropriate) (measure 18)   26.1  36.8  45.6   74.4%  Improved 
Percent of patients screened for colorectal cancer (measure 19)   60.0  57.7  61.3   2.3%  Improved 
Percent of age-appropriate women screened for breast cancer 
(measure 20)   63.3  63.0  66.3   4.7%  Improved 
Percent of patients screened for high blood pressure and a followup  
plan  was created (when appropriate) (measure 21)   86.1  59.3  74.1   (13.8%)  Worsened 
At-Risk  Populations 
Percent of diabetes patients with poorly controlled blood glucose 
level (reverse scored) (measure 27)*   19.2  17.8  N/A   (7.1%)  Improved 
Percent of patients with hypertension who have adequately 
controlled blood pressure (measure 28)   68.6  69.4  70.0   2.0%  Improved 
Percent of patients with ischemic vascular disease who have  
adequately controlled cholesterol level  (measure 29)*   57.5  58.8  N/A   2.2%  Improved 
Percent of patients with ischemic vascular disease taking aspirin or 
other antithrombotic (measure  30)  81.8  85.6  86.4   5.6%  Improved 
Percent of patients with heart failure and ventricular dysfunction who 
were prescribed beta-blocker therapy (measure 31)   86.0  87.9  90.1   4.9%  Improved 
Diabetes Composite*   24.2  26.3  N/A  8.8%  Improved 
Coronary Artery Disease Composite*   66.2  69.4  N/A  4.8%  Improved 
* CMS discontinued the quality  measure in 2015. 
 
Note: The quality measures introduced in 2015 are  not included.
 	
 
 
 
 
 
 
 
 
 
 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         2  9   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX C 
 
 Exhibit C-1: ACOs Performance on Quality  Measures  Compared to Fee-for-Service Providers, 
          2013 to 2015 
  
50th Percentile 
Timely Care, Appointments, and Information (measure 1) 
How Well Your Doctors  Communicate (measure 2) 
Patients'  Rating of Doctor (measure 3) 
Access to Specialists (measure 4) 
Health Promotion and Education (measure 5) 
Shared DecisionMaking (measure 6) 
AllCause Readmissions (measure 8) 
Admissions for COPD and Asthma (measure  9) 
Admissions for Congestive  Heart Failure (measure 10) 
PCPs Qualifying for EHR Incentive  Payment  (measure 11) 
Medication Reconcilliation (measure 12) 
Screening for Future  Fall  Risk (measure 13) 
Infleunza Immunization (measure 14) 
Pneomococcal Vaccination (measure 15) 
Adult Weight Screening and Followup (measure 16) 
Tobacco Use  Assessment and Cessation (measure 17) 
Depression Screening and Followup Plan (measure 18) 
Colorectal Cancer Screening  (measure 19) 
Mammography Screening (measure 20) 
Blood Pressure Screening  (measure 21) 
Diabetes: HbA1c  Control  (measure 27) 
Controlling High Blood Pressure (measure 28) 
IVD: Cholesterol Control (measure 29) 
IVD: Aspirin Use (measure 30) 
LVSD: BetaBlocker Therapy (measure 31) 
Diabetes Composite 
Coronary Artery Disease Composite 
10 Belo20w    30  40  50  60  70  80  90  Ab1o0v0e 
30th  90th 
FeeforService Percentiles 
Percentile  Percentile 
2013  2014  2015 
 
Note: This exhibit shows the extent to which ACOs outperformed fee-for-service providers.  We considered ACOs to outperform fee-for-service 
providers if the median score for all ACOs exceeded the 50th percentile for that measure.  For this chart, we used a technique called linear 
interpolation to approximate the data points for median scores that fall between two  deciles.  We did not include measure 7 because it did not have 
comparable data for fee-for-service providers.  The diabetes composite score includes measures 22 to 26, and the coronary artery  disease 
 
composite score includes measures 32 and 33.   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  0   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX D 
   
Exhibit D-1:  Changes in Average Medicare Spending per 
Beneficiary for ACOs, 2010 to 2015 
  Change in  Average   
Spending:   Change in  Average 
ACOs That Saved and  Spending:       
Did Not Score  High on  High-Performing 
Quality*   ACOs**  
Overall Spending     $28   ($673)  
Hospital Inpatient Care   ($238)   ($549)  
Skilled Nursing  Facility  Care   ($134)   ($287)  
Home Health Care   ($131)   ($198)  
Durable Medical Equipment   ($62)   ($71)  
Hospice Care   ($3)   ($44)  
Part B Services  $200  $120 
Hospital Outpatient Care   $395   $355  
Source: OIG analysis of ACO spending data, 2017. 
* Includes ACOs that met CMSs minimum savings rate  but had an  overall quality  score  below 90. 
** Includes ACOs that met CMSs minimum savings rate  and had an overall quality  score  of 90  or above. 
Note: Totals do not equal the sum of the rows due to rounding.  
 
 
 
 
 
 
 
 
 
 
 
 
 
   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  1   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX E 
 
Average Medicare Spending per Beneficiary  for Key  Services,    
           
2010 to 2015 

 
 
Exhibit E-1: Average Spending per Beneficiary  for Home Health Care,  

2010 to 2015 	
 
 $900 
 $800
 y
r
a
ci
fi
e  $700
n
e
B
 r
e
p  $600
 s
r
a
oll
D
 $500
Benchmark Years   Performance  Years  
$400
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017.  
 
Exhibit E-2: Average Medicare Spending per Beneficiary  for Durable Medical 

Equipment, 2010 to 2015 	
 
$340 
$320 
 y $300 
r
a
fici $280 
e
n
e
B $260 
r 
e
p
s  $240 
r
a
oll
D $220 
BBeenncchhmmaarrkk  YYeeaarrss    PPeerfroformrmanancece Y  eYearasr s  
$200 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017. 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  2  	

and Improving Quality  (OEI-02-15-00450)
	 
   
   
APPENDIX E (CONTINUED) 
 
 
Exhibit E-3: Average Medicare Spending per Beneficiary  for Hospice Care,  
2010 to 2015   
$360 
$340 
 ry $320 
a
ci
efi $300 
n
e
B $280 
r 
e
p
s  $260 
r
a
oll $240 
D
$220 
BBeenncchhmmaarrkk  YYeeaarrss    PPeerrffoorrmmaannccee   YYeeaarrss   
$200 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017. 
 
 
Exhibit E-4: Average Medicare Spending per Beneficiary  for Part B Services, 
2010 to 2015   
$3,800 
$3,600 
 y
r
a $3,400 
ci
fi
e
n $3,200 
e
B
r 
pe $3,000 
s 
r
a
oll $2,800 
D
$2,600 
Benchmark Years   Performance  Years  
Benchmark Years  Performance Years 
$2,400 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017.  
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  3   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX E (CONTINUED)  
 
Exhibit E-5: Average Medicare Spending per Beneficiary  for Hospital 
Outpatient Care, 2010 to 2015  
$2,200 
$2,000 
 y
r
a
ci
fi $1,800 
e
n
e
B
r 
e $1,600 
p
s 
r
a
Doll $1,400 
BeBnechnmchamrka rYke aYresa  rs  PPeerrffoorrmmaannccee   YYeeaarrss   
$1,200 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  4   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX F 
 
Exhibit F-1:  Changes in  Average Utilization  per Beneficiary  for ACOs,    
2010 to 2015  
  Change in  Average   
Utilization:          Change in  Average   Change in  Average  
High-Performing  Utilization:          Utilization:    
ACOs   Other ACOs  Nation  
Hospital Admissions   (20%)   (14%)   (11%)  
Skilled Nursing  Facility  
Admissions*  (16%)   (7%)   (4%)  
Primary  Care Physician 
Visits  1%  3%   4% 
Emergency  Department 
Visits  (1%)   3%   6%  
CT Scans  (17%)   (10%)   (9%)  
MRI Scans  0%   4%   6%  
Source: OIG analysis of ACO utilization data, 2017. 
* Change in skilled nursing facility  admissions is for  2013 to 2015 only  due to data  availability.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  5   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX G 
 
Average Utilization per Beneficiary  for Key Services,  
2010 to 2015 
 
 
Exhibit G-1:  Average Number of Hospital Admissions per Beneficiary, 2010 
to 2015 
0.43 
r
pe 0.41 
s 
n
o 0.39 
si
s
mi 0.37 
Ad ary 0.35 
pital nefici 0.33 
ose
HB 0.31 
f 
o
er  0.29 
b
um 0.27  Benchmark Years  Performance Years 
N Benchmark Years   Performance  Years  
0.25 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
  
Source: OIG analysis of ACO spending data, 2017. 
 
 
Exhibit G-2:  Average Number of SNF Admissions per Beneficiary, 2013 to 
2015*  
0.090 
r 
pe 0.085 
s 
n
o
si 0.080 
mis ry
F Adeficia 0.075 
Nn
Se
of B 0.070 
r 
e
b
m
u 0.065 
N Performance Years 
Performance Years 
Performance  Years  
0.060 
2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017.  
* Data for skilled nursing facility admissions available for 2013 to 2015 only. 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  6   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX G (CONTINUED)
  
 
 
Exhibit G-3:  Average Number of Primary Care Visits per Beneficiary, 2010 to 
2015  
11.0 
r
e
p 10.5 
s 
t
si
Vi 10.0 
e 
Car ary 9.5 
y ci
marnefi 9.0 
PriBe
f 
o 8.5 
r 
e
b
m 8.0 
u
N
Benchmark Years   Performance  Years  
7.5  Benchmark Years  Performance Years 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017.  
 
 
 
Exhibit G-4:  Average Number of Emergency Department Visits per 
Beneficiary, 2010 to 2015  
0.75 
t 
n
e
m
t
ar y
pr
ea 0.70 
Dci
ncy nefi
ee
gB
erer 
mp
Es  0.65 
of sit
r Vi
e
b
m
Nu Benchmark Years   Performance  Years  
0.60  Benchmark Years  Performance Years 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
  
Source: OIG analysis of ACO spending data, 2017. 
 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  7   
and Improving Quality  (OEI-02-15-00450)  
   
   
APPENDIX G (CONTINUED)
  
 
 
Exhibit G-5:  Average Number of CT Scans per Beneficiary, 2010 to 2015  
0.95 
 y
r 0.90 
a
ci
efi 0.85 
n
e
B 0.80 
r 
e
p 0.75 
s 
n
ca 0.70 
S
T 
C 0.65 
f 
o
r  0.60 
e
b
m 0.55 
u
N BeBnecnhcmhmarakr Yke Yaeras  rs  PPeerrffoorrmmaannccee  Y Yeeaarrss   
0.50 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
   
Source: OIG analysis of ACO spending data, 2017. 
 
 
Exhibit G-6:  Average Number of MRI Scans per Beneficiary, 2010 to 2015  
0.34 
 y
r
cia 0.32 
fi
e
n
e 0.30 
B
r 
e
p 0.28 
s 
n
a
Sc 0.26 
RI 
M
0.24 
f 
o
r 
be 0.22 
m
u BBeenncchhmmaarrkk Y Yeeaarrss    PPeerrffoorrmmaannccee   YYeeaarrss   
N 0.20 
2010  2011  2012  2013  2014  2015 
HighPerforming  ACOs  Other ACOs  National Average 
 
Source: OIG analysis of ACO spending data, 2017.  
 
 
 
 
   
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  8   
and Improving Quality  (OEI-02-15-00450)  
   
   
ACKNOWLEDGMENTS 
This report was prepared under the direction of Jodi Nudelman, Regional 
Inspector General for Evaluation and Inspections in the New  York regional 
office, and Nancy Harrison and Meridith Seife, Deputy Regional Inspectors 
General. 
Judy Kellis served as the team leader for this study.  Other Office of 
Evaluation and Inspections staff from the New York regional office who 
conducted the study include Kari-Anna Adrian, Marissa Baron, and Grant 
Conway.  Ivy Ngo from  the San Francisco regional office also provided 
assistance.  Central office staff who provided support include Evan Godfrey 
and Althea Hosein. 
 
Medicare Shared Savings Program Accountable Care Organizations Have Shown Potential for Reducing Spending         3  9   
and Improving Quality  (OEI-02-15-00450)  
   
Office of Inspector General
http://oig.hhs.gov  
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95452, as  
amended, is  to protect the integrity of the Department of  Health and Human Services  
(HHS) programs, as  well  as the health  and welfare of individuals served by those programs.  
This statutory mission is carried  out through a nationwide network of audits, investigations,  
and inspections conducted by the following operating components: 
Office of Audit Services 
The Office  of  Audit Services  (OAS) provides auditing services  for HHS, either by  conducting  
audits  with its own audit resources or by  overseeing  audit work done by others.  Audits  
examine the performance of HHS programs and/or its grantees and contractors in carrying  
out their respective responsibilities and are intended  to provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and  
mismanagement and promote economy and efficiency  throughout  HHS. 
Office of Evaluation and Inspections 
The Office  of  Evaluation and Inspections (OEI)  conducts national evaluations to  provide 
HHS, Congress, and the public with timely, useful, and reliable information on significant 
issues.  These evaluations focus on preventing fraud,  waste, or abuse  and promoting  
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reports also present practical recommendations for improving program operations.  
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The Office of Investigations (OI) conducts criminal, civil, and administrative investigations  
of fraud and misconduct  related to HHS programs, operations, and individuals.  With  
investigators working in all 50 States and the District of Columbia, OI  utilizes its resources 
by actively  coordinating with the Department  of Justice  and other Federal, State, and local 
law enforcement authorities.  The investigative efforts of OI often lead to  criminal 
convictions, administrative sanctions,  and/or  civil monetary  penalties.  
Office of Counsel to the Inspector General 
The Office of Counsel to the  Inspector  General (OCIG) provides general legal services to 
OIG, rendering  advice and opinions on HHS programs and operations and  providing all  
legal support for OIGs  internal operations.  OCIG represents  OIG in all civil and 
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enforcement authorities.