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Leavitt Partners Releases “Track Switching in Medicare ACO Programs: A Look at the Move to Downside Risk” White Paper
Salt Lake City, February 25, 2019—Today, Leavitt Partners released “Track Switching in Medicare ACO Programs: A Look at the Move to Downside Risk,” a white paper providing data-driven insight into the important characteristics distinguishing ACOs that progress to downside risk tracks from those that do not. The analysis in this paper draws on Leavitt Partners Insight’s analytics solution Torch Insight (“Torch”). Torch is a robust, market-centric data integration and analytics platform that delivers reliable, comprehensive and actionable healthcare insights.
Leavitt Partners defines track switching as when an ACO switches from the upside-only Track 1 to a higher risk track. The distinctions between track switchers and non-track switchers are particularly important in the current health care environment as the pressure to provide better quality care while cutting costs is mounting from federal, private, and consumer voices. Understanding the characteristics of ACOs that have already made the jump to more risk can provide valuable insights for policy makers and other ACOs.
Key takeaways from this analysis include:
- ACO and Contract Characteristics – Track switchers entered Medicare ACO programs earlier and had larger patient populations and more payment contracts than non-track switchers.
- Program Performance – Track switchers tend to have higher savings rates, higher gross savings per beneficiary, higher earned shared savings per beneficiary, and higher net savings to CMS per beneficiary. There is an association between taking on more risk and higher savings, regardless of benchmark or size.
- Population Factors – ACOs that assumed downside risks were more likely to be located in high-population and metropolitan areas.
- Provider Characteristics – There was no significant difference in the average numbers of provider groups or hospitals between track switchers and non-track switchers.
There are at least two barriers that seem to prevent ACOs from assuming downside risk: smaller size, and less familiarity with risk. Larger, more experienced ACOs are more likely to eventually assume higher levels of risk. These findings suggest that more focus should be placed on helping ACOs achieve scale and supporting small and/or rural ACOs.
The white paper can be viewed here.
About Leavitt Partners
Leavitt Partners is a health care intelligence business. The firm helps clients successfully navigate the evolving role of value in health care by informing, advising, and convening industry leaders on value market analytics, alternative payment models, federal strategies, insurance market insights, and alliances. Through its family of businesses, the firm provides investment support, data and analytics, member-based alliances, and direct services to clients to support decision-making strategies in the value economy. For more information please visit www.LeavittPartners.com.
About Leavitt Partners Insight
Leavitt Partners Insight is a SaaS health care data and analytics company founded and incubated at Leavitt Partners. The Torch Insight platform is the culmination of years spent splicing siloed data sets together, during which our team invested thousands of hours cleaning and validating data in preparation for analysis, and integration with business intelligence platforms. We excel at blending population health data with quality, financial, and performance metrics from stakeholders across key industries. We use that blended data to develop analytical models that reveal trends and truths, enabling our clients to make more intelligent decisions. We also offer our raw data and curated insights to clients. For more information, please visit https://torchinsight.com.