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Original Investigation
Health Care Reform
February 13, 2017

Changes in Postacute Care in the Medicare Shared Savings Program

Author Affiliations
  • 1Department of Health Care Policy, Harvard Medical School, Boston, Massachusetts
  • 2Division of General Internal Medicine and Primary Care, Brigham and Women’s Hospital, Boston, Massachusetts
  • 3Division of Cardiovascular Medicine, Department of Medicine, Brigham and Women’s Hospital, Boston, Massachusetts
  • 4Department of Health Policy, Vanderbilt University School of Medicine, Nashville, Tennessee
JAMA Intern Med. Published online February 13, 2017. doi:10.1001/jamainternmed.2016.9115
Key Points

Question  What changes in postacute care have been associated with the Medicare Shared Savings Program?

Findings  A study using fee-for-service Medicare claims found that, for accountable care organizations entering in 2012, participation in the Medicare Shared Savings Program was associated with a 9% differential reduction in postacute spending by 2014, driven by reductions in discharges to facilities, length of facility stays, and acute inpatient care. Reductions were smaller for later entrants and similar for accountable care organizations with and without financial ties to hospitals.

Meaning  Payment models that place hospitals at risk for postacute spending are not the only viable strategy to curb excessive postacute care; therefore, accountable care organizations’ incentives to achieve postacute savings should not be weakened.


Importance  Postacute care is thought to be a major source of wasteful spending. The extent to which accountable care organizations (ACOs) can limit postacute care spending has implications for the importance and design of other payment models that include postacute care.

Objective  To assess changes in postacute care spending and use of postacute care associated with provider participation as ACOs in the Medicare Shared Savings Program (MSSP) and the pathways by which they occurred.

Design, Setting, and Participants  With the use of fee-for-service Medicare claims from a random 20% sample of beneficiaries with 25 544 650 patient-years, 8 395 426 hospital admissions, and 1 595 352 stays in skilled nursing facilities (SNFs) from January 1, 2009, to December 31, 2014, difference-in-difference comparisons of beneficiaries served by ACOs with beneficiaries served by local non-ACO health care professionals (control group) were performed before vs after entry into the MSSP. Differential changes were estimated separately for cohorts of ACOs entering the MSSP in 2012, 2013, and 2014.

Exposures  Patient attribution to an ACO in the MSSP.

Main Outcomes and Measures  Postacute spending, discharge to a facility, length of SNF stays, readmissions, use of highly rated SNFs, and mortality, adjusted for patient characteristics.

Results  For the 2012 cohort of 114 ACOs, participation in the MSSP was associated with an overall reduction in postacute spending (differential change in 2014 for ACOs vs control group, −$106 per beneficiary [95% CI, –$176 to –$35], or −9.0% of the precontract unadjusted mean of $1172; P = .003) that was driven by differential reductions in acute inpatient care, discharges to facilities rather than home (−0.6 percentage points [95% CI, –1.1 to 0.0], or −2.7% of the unadjusted precontract mean of 22.6%; P = .03), and length of SNF stays (−0.60 days per stay [95% CI, –0.99 to –0.22], or −2.2% of the precontract unadjusted mean of 27.07 days; P = .002). Reductions in use of SNFs and length of stay were largely due to within-hospital or within-SNF changes in care specifically for ACO patients. Participation in the MSSP was associated with smaller significant reductions in SNF spending in 2014 for the 2013 ACO cohort (–$27 per beneficiary [95% CI, –$49 to –$6], or –3.3% of the precontract unadjusted mean of $813; P = .01) but not in the 2013 or 2014 cohort’s first year of participation (–$13 per beneficiary [95% CI, –$33 to $6]; P = .19; and $4 per beneficiary [95% CI, –$15 to $24]; P = .66). Estimates were similar for ACOs with and without financial ties to hospitals. Participation in the MSSP was not associated with significant changes in 30-day readmissions, use of highly rated SNFs, or mortality.

Conclusions and Relevance  Participation in the MSSP has been associated with significant reductions in postacute spending without ostensible deterioration in quality of care. Spending reductions were more consistent with clinicians working within hospitals and SNFs to influence care for ACO patients than with hospital-wide initiatives by ACOs or use of preferred SNFs.