Do Changes in Post-acute Care Use at Hospitals Participating in an
Accountable Care Organization Spillover to All Medicare
Amol S. Navathe, MD, PhD
, Alexander M. Bain, B.A
, and Rachel M. Werner, MD, PhD
Corporal Michael J. Cresencz VA Medical Center, Philadelphia, PA, USA;
Perelman School of Medicine, University of Pennsylvania, Philadelphia,
Leonard Davis Institute of Health Economics, The Wharton School, University of Pennsylvania, Philadelphia, PA, USA;
Division of Health
Policy, University of Pennsylvania, Philadelphia, PA, USA.
BACKGROUND: While early evidence suggests that Medi-
care accountable care organizations (ACOs) may reduce
post-acute care (PAC) utilization for attributed beneficia-
ries, whether these effects spill over to all beneficiaries
admitted to hospitals participating in ACOs stray is
OBJECTIVE: The objective of this study was to evaluate
whether changes in PAC use and Medicare spending spill
over to all beneficiaries admitted to hospitals participating
in the Medicare Shared Savings Program (MSSP).
DESIGN: Observational study using a difference-in-
differences design comparing changes in PAC utilization
and spending among beneficiaries admitted to ACO-
participating hospitals before and after the start of the
ACO contracts, compared to those admitted to non-ACO
SETTING: A total of 233 hospitals participate in MSSP
ACOs and 3103 non-ACO hospitals.
PARTICIPANTS: A national sample of 11,683,573 Medi-
care beneficiaries experiencing 26,503,086 hospital
admissions from 2010 to 2013.
EXPOSURE: Admission to a hospital participating in an
MAIN MEASURES: The probability of discharge and
Medicare payments to inpatient rehabilitation facilities
(IRF), skilled nursing facilities (SNF), and home health
KEY RESULTS: For beneficiaries admitted to hospitals
that joined an ACO, the likelihood of being discharged to
PAC did not change after the hospital joined the ACO
compared with non-ACO hospitals over the same period
(differential change in probability of discharge to any PAC
was 0.000 (P = 0.89), SNF was 0.000 (P = 0.73), IRF was
0.000 (P = 0.96), and HHAwas 0.001 (P = 0.57)). Payments
reduced significantly for PAC overall (− $130.41, P = 0.03),
but not for any individual PAC type alone. These results
were consistent in samples that were conditional on dis-
charge to any PAC, across conditions with high PAC use
nationally, and among ACO-participating hospitals that
also had a PAC participant.
CONCLUSIONS: Hospital participation in an ACO did not
result in spillovers in PAC utilization or payments to all
beneficiaries, even when considering high PAC-use con-
ditions and ACO hospitals that also have an ACO-
KEY WORDS: accountable care organization; post-acute care; skilled
nursing facility; Medicare; health policy.
J Gen Intern Med 33(6):831–8
© Society of General Internal Medicine 2018
Medicare payments for post-acute care (PAC), totalling $60
billion in 2015,
have grown faster than most other categories
of spending, and a 2013 Institute of Medicine report indicated
that PAC utilization is the largest driver of variation in Medi-
may help reduce the unwarranted variation in PAC spending,
quality, and utilization by reducing unnecessary utilization.
One of the Medicare’s largest experiments with value-based
payment is its most prevalent accountable care organization
(ACO) model, the Medicare Shared Savings Program
(MSSP). Prior work has shown that this ACO model was
associated with reductions in overall Medicare payments and
stable-to-improved quality for beneficiaries attributed to its
Early evidence also suggests that these ACOs
decrease institutional PAC utilization, including skilled nurs-
ing facilities (SNFs), inpatient rehabilitation facilities (IRFs),
and long-term care hospitals, as well as reduced spending on
SNFs for attributed beneficiaries.
While over 9 million Medicare beneficiaries are directly
affected by ACOs through attribution, this represents a small
fraction of the 57.5 million beneficiaries nationwide.
goal of ACO policies is to encourage system-wide practice
transformation to improve the value of care for all patients,
not just those attributed to the ACO, though the financial
incentives through MSSP may besmall.However,whether
all beneficiaries admitted to hospitals participating in Medicare
ACOs experience these beneficial spillovers is unknown, but is
of vital importance in evaluating the overall impact of ACOs.
Electronic supplementary material The online version of this article
(https://doi.org/10.1007/s11606-018-4368-z) contains supplementary
material, which is available to authorized users.
Received July 21, 2017
Revised October 27, 2017
Accepted January 31, 2018
Published online March 8, 2018