Statistical uncertainty in the Medicare shared savings program.

ABSTRACT: Analyze statistical risks facing CMS and Accountable Care Organizations (ACOs) under the Medicare Shared Savings Program (MSSP). We calculate the probability that shared savings formulas lead to inappropriate payment, payment denial, and/or financial penalties, assuming that ACOs generate real savings in Medicare spending ranging from 0-10%. We also calculate expected payments from CMS to ACOs under these scenarios. The probability of an incorrect outcome is heavily dependent on ACO enrollment size. For example, in the MSSP two-sided model, an ACO with 5,000 enrollees that keeps spending constant faces a 0.24 probability of being inappropriately rewarded for savings and a 0.26 probability of paying an undeserved penalty for increased spending. For an ACO with 50,000 enrollees, both of thes

SUBMITTER: DeLia D 

PROVIDER: S-EPMC4006477 | biostudies-literature | 2012

REPOSITORIES: biostudies-literature