The Centers for Medicare & Medicaid Services (CMS) announced today that the Medicare Shared Savings Program saved money for Medicare while continuing to support high-quality care. Specifically, the program saved Medicare $1.8 billion in 2022 compared to spending targets for the year. This marks the sixth consecutive year the program has generated overall savings and high-quality performance results. This represents the second-highest annual savings accrued for Medicare since the program’s inception more than ten years ago. 

“This program has delivered more than $1.8 billion in savings and delivered high-quality health care to millions of people,” said HHS Secretary Xavier Becerra. “Just last month, we proposed ways to further grow and expand this successful program, especially in rural and other underserved communities. The Biden-Harris Administration will continue to do everything we can to strengthen Medicare and ensure everyone can access high-quality, affordable health care.” 

“The Medicare Shared Savings Program helps millions of people with Medicare experience coordinated health care while also reducing costs for the Medicare program,” said CMS Administrator Chiquita Brooks-LaSure. “CMS will continue to improve the program, and it is exciting to see that Accountable Care Organizations are continuing to be successful in delivering coordinated, high-quality, affordable, equitable, person-centered care.” 

Shared Savings Program Accountable Care Organizations (ACOs) are groups of doctors, hospitals, and other health care providers who collaborate and provide coordinated, high-quality care to people with Medicare, focusing on delivering the right care at the right time while avoiding unnecessary services and medical errors. When an ACO succeeds in both delivering high-quality care and spending health care dollars more wisely, the ACO may be eligible to share in the savings it achieves for the Medicare program (also known as performance payments). This also drives lower health care costs for people with Medicare, who see lower out-of-pocket spending on avoidable health care utilization like emergency department visits because the ACO has better coordinated their care.

Over the past decade, the Shared Savings Program has grown into one of the largest value-based purchasing programs in the country. Value-based purchasing programs link provider payments to improved performance by health care providers. This form of payment holds health care providers accountable for both the cost and quality of care they provide, and it attempts to reduce inappropriate care and to identify and reward the best-performing health care providers. As of January 2023, Shared Savings Program ACOs include over 573,000 participating clinicians who provide care to almost 11 million people with Medicare. Based on the program’s success and opportunities to continually improve value for people with Medicare and the health care system, CMS has set a goal that 100 percent of people with Traditional Medicare will be part of an accountable care relationship by 2030.

“We are encouraged and inspired by six consecutive years of savings and high-quality care, with 2022 being one of the strongest years of performance to date,” said Meena Seshamani, MD, PhD, CMS Deputy Administrator and Director of the Center for Medicare. “The Shared Savings Program is Medicare’s permanent, flagship Accountable Care Program, and we look forward to continually improving and growing the program, expanding the reach of participating ACOs, and addressing critical health disparities across the country.”

ACOs had a higher average performance on quality measures they are required to report in order to share in savings compared to other similarly sized clinician groups not in the program. This includes statistically significant higher performance for quality measures related to diabetes and blood pressure control; breast cancer and colorectal cancer screening; tobacco screening and smoking cessation; and depression screening and follow-up. The higher quality performance by ACOs underscores how this type of coordinated, whole-person care can improve treatment of behavioral health conditions, helping to achieve the goals of the CMS’ Behavioral Health Strategy and improve cancer screening rates and prevention in line with the goals of the Cancer Moonshot.

Approximately 63% of participating ACOs earned payments for their performance in 2022. ACOs that earned more shared savings tended to be low revenue. Low-revenue ACOs are usually ACOs that are mainly made up of physicians and may include a small hospital or serve rural areas. With $228 per capita in net savings, low-revenue ACOs led high-revenue ACOs, who had $140 per capita net savings, and low-revenue ACOs comprised of 75% primary care clinicians or more saw $294 per capita in net savings, more than twice as much. These results underscore how important primary care is to the success of the Shared Savings Program and demonstrate how the program supports primary care providers. As articulated in a recently published article, the Innovation Center continues to explore testing models and features to support Shared Savings Program ACOs in increasing investment in primary care services.

Earlier this year, in the Calendar Year (CY) 2024 Physician Fee Schedule proposed rule, CMS proposed changes to the Medicare Shared Savings Program that would promote participation among health care providers and promote equity, especially in rural and underserved areas, helping to grow this successful program and improve access to coordinated, efficient, and high-quality care provided by ACOs for more people with Medicare. In particular, CMS proposes increasing the number of people receiving high-quality, accountable care by assigning more people who receive care from nurse practitioners, physician assistants, and clinical nurse specialists to ACOs. In addition, CMS proposes changes to the benchmark methodology to encourage participation by ACOs caring for medically complex, high-cost beneficiaries to join the program.  These changes would further advance CMS’ overall value-based care strategy of growth, alignment, and equity, building on changes finalized in 2022, which included the establishment of advance investment payments for ACOs in rural and underserved communities, changes to the benchmark methodology, more time to transition to downside risk, and a health equity adjustment that rewards excellent care delivered to underserved communities.  Public comments on the CY 2024 Physician Fee Schedule proposed rule are due by September 11, 2023. 

For more information on the Medicare Shared Savings Program, visit https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram 

For more information on the proposals for the Medicare Shared Savings Program in the CY 2024 Physician Fee Schedule proposed rule, visit https://www.federalregister.gov/documents/2023/‌‌‌08/07/2023-14624/medicare-and-medicaid-programs-cy-2024-payment-policies-under-the-physician-fee-schedule-and-other, or reference the Shared Savings Program Fact Sheet at https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2024-medicare-physician-fee-schedule-proposed-rule-medicare-shared-savings-program

View the 2022 Medicare Shared Savings Program Financial and Quality performance results at https://data.cms.gov/medicare-shared-savings-program/performance-year-financial-and-quality-results/data

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“At CMS, we are constantly striving to expand access to high quality, comprehensive health care for people served by the Medicare program,” said CMS Administrator Chiquita Brooks-LaSure. “Today’s proposals expand access to vital medical services like behavioral health care, dental care, and cancer treatment options, all while promoting access, innovation, and cost savings in the Medicare program.” 

“Integrated coordinated, whole-person care — which addresses physical health, behavioral health, and social determinants of health — is crucial for people with Medicare, especially those with complex needs,” said Dr. Meena Seshamani, CMS Deputy Administrator and Director of the Center for Medicare. “If finalized, the proposals in this rule will advance equity, lead to better care, support healthier populations, and drive smarter spending of the Medicare dollar.

The proposed CY 2023 PFS conversion factor is $33.08, a decrease of $1.53 to the CY 2022 PFS conversion factor of $34.61. This conversion factor accounts for the statutorily required update to the conversion factor for CY 2023 of 0%, the expiration of the 3% increase in PFS payments for CY 2022 as required by the Protecting Medicare and American Farmers From Sequester Cuts Act, and the statutorily required budget neutrality adjustment to account for changes in Relative Value Units.  

Modernizing Coverage for Behavioral Health Services

In the 2022 CMS Behavioral Health Strategy, CMS set goals to remove barriers to care and improve access to, and the quality of, mental health and substance use care. To help address the acute shortage of behavioral health practitioners, the agency is proposing to allow licensed professional counselors (LPCs), marriage and family therapists (LMFTs), and other types of behavioral health practitioners to provide behavioral health services under general (rather than direct) supervision. Additionally, CMS is proposing to pay for clinical psychologists and licensed clinical social workers to provide integrated behavioral health services as part of a patient’s primary care team.

CMS is also proposing to bundle certain chronic pain management and treatment services into new monthly payments, improving patient access to team-based comprehensive chronic pain treatment. Lastly, CMS is proposing to cover opioid treatment and recovery services from mobile units, such as vans, to increase access for people who are homeless or live in rural areas.

Expanding Access to Accountable Care Organizations

Accountable Care Organizations (ACOs) are groups of health care providers who come together to give coordinated, high-quality care to their Medicare patients. The Medicare Shared Savings Program covers more than 11 million people with Medicare and includes more than 500,000 providers.

CMS is proposing changes to the Medicare Shared Savings Program that, if finalized, represent some of the most significant reforms since the final rule that established the program was finalized in November 2011 and ACOs began participating in 2012. Building on the CMS Innovation Center’s successful ACO Investment Model (AIM), CMS is proposing to incorporate advance shared savings payments to certain new Medicare Shared Savings Program ACOs that could be used to address Medicare beneficiaries’ social needs. This is one of the first times Traditional Medicare payments would be permitted for such uses, and is expected to be an opportunity for providers in rural and other underserved areas to make the investments needed to become an ACO and succeed in the program. CMS is also proposing that smaller ACOs have more time to transition to downside risk, further helping to grow participation in rural and underserved communities. CMS is also proposing a health equity adjustment to an ACO’s quality performance category score to reward excellent care delivered to underserved populations. Finally, CMS is proposing benchmark adjustments to encourage more ACOs to participate and succeed, which would help achieve the goal of having all people with Traditional Medicare in an accountable care relationship with a healthcare provider by 2030.

Improving Access to Colon Cancer Screening

Colon and rectal cancer were the second-leading cause of cancer deaths in the United States in 2020, with higher colorectal cancer death rates for Black Americans, American Indians, and Alaska Natives. To reduce barriers to getting a colonoscopy, CMS is proposing that a follow-up colonoscopy to an at-home test be considered a preventive service, which means that cost sharing would be waived for people with Medicare. Additionally, Medicare is proposing to cover the service for individuals 45 years of age and above, in line with the newly lowered age recommendation (down from 50) from the United States Preventive Services Task Force.

Proposing Payment for Dental Services that are Integral to Covered Medical Services

Medicare Part B currently pays for dental services when that service is integral to medically necessary services required to treat a beneficiary’s primary medical condition. Some examples include reconstruction of the jaw following accidental injury or tooth extractions done in preparation for radiation treatment for jaw cancer. CMS is proposing to pay for dental services, such as dental examination and treatment preceding an organ transplant. In addition, CMS is seeking comment on other medical conditions where Medicare should pay for dental services, such as for cancer treatment or joint replacement surgeries, as well as on a process to get public input when additional dental services may be integral to the clinical success of other medical services.

For a fact sheet on the CY 2023 Physician Fee Schedule proposed rule, please visit: https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2023-medicare-physician-fee-schedule-proposed-rule

For a fact sheet and related information on the CY 2023 Quality Payment Program proposed changes, please visit (clicking link downloads zip file):https://qpp-cm-prod-content.s3.amazonaws.com/uploads/1972/2023%20Quality%20Payment%20Program%20Proposed%20Rule%20Resources.zip

For a fact sheet on the proposed Medicare Shared Savings Program changes, please visit:https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2023-medicare-physician-fee-schedule-proposed-rule-medicare-shared-savings-program

For a CMS blog on the proposed behavioral health changes, please visit: https://www.cms.gov/blog/strengthening-behavioral-health-care-people-medicare

To view the CY 2023 Physician Fee Schedule and Quality Payment Program proposed rule, please visit: https://www.federalregister.gov/public-inspection/2022-14562/medicare-and-medicaid-programs-calendar-year-2023-payment-policies-under-the-physician-fee-schedule  

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