Simulation Predicts Limited Savings from Medicare Shared Savings Program

After the costs of performance improvement, accountable care organizations may realize limited savings from participation in the Medicare Shared Savings Program, concludes a study published online October 3, 2012, in Health Affairs. The study’s researchers used a simulation model to analyze the effects of the Shared Savings Program quality measures and performance targets on Medicare costs in a simulated population of patients age 65 to 75 with type 2 diabetes. They found that a 10% improvement in performance on diabetes quality measures would reduce Medicare costs only by up to about 1% under the current program model.