Groups of healthcare providers, working to better coordinate care and spending with one another, cut Medicare spending by $62 million in the first year, with much of that coming reduced use of skilled nursing facilities.

The Centers for Medicare & Medicaid Services announced the first-year results from its Next Generation Accountable Care Organization Model on Monday. This care coordination model kicked off in 2016, with 18 participating groups in several states. CMS officials noted that much of those savings were enabled by lower skilled nursing associated costs.

Officials noted that SNF spending decreases reached statistical significance for three ACOs in particular, with a 3.1% drop on this segment of care, or $16.1 million in spending. ACO leaders explained that they used methods such as performing rounds in skilled nursing facilities, harnessing telehealth and conducting visits at patients’ homes to help find savings.

CMS Administrator Seema Verma expressed excitement about the early results in a statement Monday. She said the agency may take principles from this Next Generation Model — which involves the highest levels of risk for providers — more broadly for ACOs in Medicare. “These results provide further evidence that ACOs succeed under two-sided risk,” she said.

Ten of the Next Generation ACOS took advantage of the SNF three-day waiver, allowing them to accept patients after just one day in the hospital. Typically, under Medicare rules, patients need to be at a hospital for at least three consecutive days before Medicare covers their treatment at a SNF.