CMS Physician Group Practice Demonstration Results

Submitted by jonpearce on Tue, 2011-08-09 00:00

The results of the Physician Group Practice (PGP) demonstration project have recently been released and are available from CMS here. Of interest in these results is the unevenness of the results. Of the 10 participating groups, one group received 52% of all shared savings payments, while three groups failed to achieve any shared savings. Two groups achieved consistent multimillion dollar savings beginning in the first year, while the other groups achieved inconsistent savings levels. These savings were non-inclusive of the costs that the groups incurred to participate in the program, and the net financial effects of participating in the demonstration are not discussed in the report.


PGP Shared Savings Results - click to enlarge


The quality scores of the groups generally (although not consistently) increased throughout the 5 year demonstration period; the average scores in years 4 and 5 exceeded the averages for years 1 and 2 for six of the PGP groups. This may have been due to the introduction of new quality measures throughout the 5 year period.

PGP Quality Results - click to enlarge

Also of interest is the lack of correlation between the quality measures and the shared savings payment. While PGP groups that received large shared savings payments had high quality scores, other groups with similarly high scores received no payments. This does not indicate that there is no correlation between quality and cost; rather it indicates that the structure of this particular demonstration didn’t indicate any such correlation.


PGP Quality vs. Shared Savings - click to enlarge

These results are often cited as being indicative of those that can be expected under the Accountable Care Organization pilot program; however there are many differences between the structure of the PGP program and the currently-proposed ACO structures. Notably, the PGP savings targets were risk-adjusted throughout the period, while the proposed ACO regulations seem to indicate that ACO targets will not be risk adjusted. The risk adjustments themselves may be a significant factor in the success of some PGPs, as noted in this Single Tracks article on Risk Adjustments for Individuals and Groups , as well as this article on Risk Adjustment and the Luck of the Draw. Finally, it’s important with respect to CMS demonstrations to remember that “when you’ve seen one, you’ve seen one”. The details of each program are different, and those differences can dramatically alter the results that an organization can achieve.