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Press Release

Study Shows Medica's Unique Provider Relationships Have Lower Costs, Better Outcomes than Open Access Plans

Medica findings based on analysis of claims between Jan. 1, 2018 — Dec. 31, 2019

May 3, 2021

MINNETONKA, Minn. — Members in an accountable care organization (ACO) plan experience better health at a lower cost than expected and, when compared to open access plans, better quality of care. The findings stem from data collected and analyzed by Medica for its 200,000 commercial and individual members in ACO plans.

"We are pleased to show measurable improvement in cost, quality and experience for our members in ACO plans," said John R. Mach, M.D., Medica's chief medical officer. "The data proves that our emphasis on health care value has been successful for everyone involved — from ACO care providers and health plans to employers and ACO plan members, who ultimately pay lower premiums as a result. These partnerships with providers have allowed us to put the focus on the consumer experience and the support of high-quality, lower cost care."

Cost savings

The analysis shows that, overall, costs for members who received care in an ACO were lower than for those who received their care through an open access plan. Costs in an ACO were 13 percent lower than for open access plans. Employer plan costs were 11 percent lower, while individual plan costs were 38 percent lower.

Medica's analysis also showed savings in ACO plans for specific conditions when compared to expected costs. For the study, actual costs were measured by the amount paid for claims while expected costs were calculated through cost modeling. Table 1 shows the difference in actual costs vs. expected costs for these categories in both populations.

Table 1: ACO Plans Cost Savings

Health Care Intervention

Employer ACO Plans

Individual Member ACO Plans

Variance vs. expected costs

Variance vs. expected costs

Inpatient Hospital Stay

11% lower costs

26% lower costs

Outpatient Surgery

19% lower costs

18% lower costs

Emergency Room Visits

29% lower costs

14% lower costs

Quality of care

In addition to cost savings, Medica ACO plans outperform open access plans on quality. In one closely watched metric, when compared to open access plans, hospital readmission rates for all conditions were 14 percent lower for employer ACO plans and 6 percent lower in individual ACO plans.

Both employer and individual ACO plans also provided improvements in care and overall health when compared to open access plans, as shown on HEDIS measures, which provide a set of standardized health quality measures. Generally, the measures use a 100-point scale; a higher number indicates better quality. For emergency department usage, a lower score indicates better quality. Table 2 and Table 3 provide the HEDIS measures on specific health interventions for employer and individual plan ACOs, respectively.

Table 2: Key HEDIS Measures: Employers Plans ACO vs. Open Access



Open Access

Breast cancer screening



Colorectal screening



Emergency department usage



Child wellness visits



Table 3: Key HEDIS Measures: Individual Plans ACO vs. Open Access



Open Access

Breast cancer screening



Colorectal screening



Emergency department usage



Child wellness visits



Medica ACOs

Medica has ACO relationships with 25 care systems across nine states. Collectively, the ACOs include more than 400 hospitals and nearly 4,000 primary care clinics. ACO enrollment makes up a growing percentage of its total membership, and in 2020, membership in ACO plans grew by more than 20 percent. Today, nearly 200,000 Medica members get their coverage through an ACO and more than 90 percent of them renew their ACO plan each year.

Medica's ACO plans are developed with ACO provider partners and together, risk-sharing models aligned around clinical value, common governance and common service models are developed. The organizations also regularly review operational, service, clinical and financial results.

To learn more about Medica's ACO partnerships and its commitment to improving the consumer experience and quality, while lowering health care costs, please visit

About Medica

Medica is a non-profit health plan headquartered in Minnesota. The company serves communities in the heart of America by providing health care coverage and related services in the employer, individual, Medicaid and Medicare markets. It operates in Minnesota, Iowa, Kansas, Missouri, Nebraska, North Dakota, Oklahoma, South Dakota and Wisconsin.

Medica's vision is to be trusted in the community for our unwavering commitment to high quality, affordable health care. Medica's annual report, which includes the organization's community involvement activities, is available online.


Greg Bury

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