ACO reduces medical costs

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An examination of Part D drug spending during the first year of an accountable care organization discovered that medical costs went down and prescription drug spending did not rise.

Researchers from the University of Pittsburgh Graduate School of Public Health investigated costs for 2012, the first year ACOs were in place.

ACOs lowered per-person Medicare costs by an average of $345. 

Meanwhile, beneficiaries in an ACO experienced no significant changes in drug spending, total prescriptions filled or percentage of Medicare claims for brand-name drugs, researchers said.

The analysis compared outcomes of more than 316,000 Medicare Part D beneficiaries in an ACO in 2012 to those of nearly 560,000 beneficiaries who were not in an ACO during the same time frame. Study results were published in Medical Care.

Medicare beneficiaries with Part D prescription coverage with six or more chronic conditions who were connected to an ACO had the highest savings on medical costs — $966 per patient in 2012, said lead author Yuting Zhang, Ph.D., upon releasing findings on March 13.

“This is encouraging,” Zhang noted, “because it demonstrates that ACO providers may be prioritizing their focus on beneficiaries with multiple chronic conditions.”