New Research Shows Impact of Recent Policies on ACO Growth

October 22, 2019

Salt Lake City, October 21, 2019— Leavitt Partners and the Duke-Margolis Center for Health Policy released “Spread of ACOs And Value-Based Payment Models In 2019: Gauging the Impact of Pathways to Success,” which leveraged data from Torch Insight, a robust, market-centric data integration and analytics platform developed by Leavitt Partners Insight. This annual paper summarizes the growth and geographic spread of Accountable Care Organizations (ACOs) and highlights trends with value-based care.

Notable findings include:

  • As of the beginning of the third quarter 2019, an estimated 1,588 ACO contracts among 995 ACOs are covering 44 million lives.
  • For the first time, the number of ACOs has decreased, with a net reduction across all payers since 2018. Some of this decrease may have been a result of the new Pathways to Success program from Medicare, which requires ACOs to assume downside risk.
  • The total number of lives covered by ACO contracts increased, some of which was driven by the growth of commercial contracts.
  • The proportion of ACOs accepting downside risk has increased significantly, including a slightly higher percentage of physician-led ACOs accepting risk-based contracts.
  • Major new alternative payment models for Medicare, including Primary Care First, Direct Contracting, and specialty models for kidney health and radiation oncology, will expand the types of value-based arrangements that providers can enter.

These findings suggest that population-based alternative payment models, such as those covered by ACOs, have slowed, but that the appetite for many providers to move toward value-based payment models continues. Of note, the willingness of more providers to accept contracts with downside risk suggest that providers are becoming more comfortable with risk as they feel confident that they can effectively manage its possibility.

For a complete review of the findings, visit the Health Affairs Blog here.

About Leavitt Partners:

Leavitt Partners is a health care intelligence business. The firm helps clients successfully navigate the evolving role of value in health care by informing, advising, and convening industry leaders on value market analytics, alternative payment models, federal strategies, insurance market insights, and alliances. Through its family of businesses, the firm provides investment support, data and analytics, member-based alliances, and direct services to clients to support decision-making strategies in the value economy. For more information please visit www.LeavittPartners.com

About Duke-Margolis Center for Health Policy
The Robert J. Margolis, MD, Center for Health Policy at Duke University brings together expertise from the policy community in Washington, DC, Duke University, and Duke Health to address the most pressing issues in health policy. The mission of Duke-Margolis is to improve health and the value of health care through practical innovative, and evidence-based policy solutions. For more information, please visit our web site: healthpolicy.duke.edu.

About Leavitt Partners Insight
Leavitt Partners Insight is a SaaS health care data and analytics company founded and incubated at Leavitt Partners. We've spent years splicing siloed data sets together, investing thousands of hours cleaning and validating data in preparation for analysis, and integration with business intelligence platforms. We excel at blending population health data with quality, financial, and performance metrics from stakeholders across key industries. We use that blended data to develop analytical models that reveal trends and truths, enabling our clients to make more intelligent decisions. We also offer our raw data and curated insights to you. For more information, please visit https://www.leavittpartnersinsight.com/.