Payment Model a Success for Providers, Patients and Medicare

The Advanced Payment Model demonstration project is complete. The Model was designed to test whether pre-paying shared savings would result in higher participation in the model from independent physicians and rural providers. It also tests whether such participation will lower costs and/or improve the quality of care for Medicare Beneficiaries. The ACO Investment Model (AIM) follows the same principles as Advanced Payment but also allows providers employed by Critical Access Hospitals to participate in the program.


The average Advanced Payment ACO generated $2 million per performance year, almost twice as much savings per year as the average MSSP ACO. Advanced Payment model ACO’s also saved almost five times as much per beneficiary at $241.40 per year, vs. $58.64 per beneficiary per year for all MSSP ACO’s. The program saved the trust fund $21.5 million over three years.


For the 31 ACO’s that remained in the Advanced Payment program for three years, the average quality score increased from 90.2% to 92.9% by the third year.


Thirty-six of the one hundred new MSSP ACO’s in 2016 are ACO Investment Model (AIM) ACO’s, an updated version of the Advanced Payment model, and more than two-thirds of them are solely rural. Most AIM participants say they would not participate in the MSSP without AIM support. The 2016 AIM program increased rural participation in ACO’s five-fold.


ACO participation appears to have more impact in small and rural practices with limited experience in managing care when compared to all MSSP ACO’s. Small and rural ACO participants are likely to avoid penalties under MACRA’s quality payment program. Providing support for these practices at no net cost to the government is in the public interest.

In conclusion, the Advanced Payment model is successful in helping small practices and rural providers participate in the MSSP while improving quality and lowering per capita cost, and provides a net savings to the Medicare Trust fund. The Secretary should exercise her authority under the ACA to make the program permanently available to small and rural practices.

ALL MSSP ALL Advanced Pay
Per ACO Per Year $1,009,871 $1,975,039
Per Beneficiary Year $58.64 $241.40
Average Savings 0.58% 2.28%
Total Beneficiary Years 16,275,327 850,880
Total Savings $954,328,267 $205,404,040
Estimated Total Advanced Pay $80,684,908
Estimated Advanced Pay Repayment $38,369,312
Shared Savings Payments $1,298,712,390 $141,596,556
Net Savings (Loss) -$344,384,123 $21,491,888