Do Medicare Value-Based Programs Benefit Commercial Patients?
As Medicare increasingly shifts toward value-based care models, a critical question emerges: do the benefits of these arrangements extend beyond Medicare beneficiaries to commercially insured populations? A new observational study published in the American Journal of Managed Care (2026) investigated whether the growth of Medicare Shared Savings Program (MSSP) accountable care organizations (ACOs) and Medicare Advantage (MA) penetration was associated with measurable changes in health care use among commercially insured adults.
The short answer: the spillover effects are minimal.
Study Design and Population
Researchers used Health Care Cost Institute (HCCI) claims data from 2015 to 2019, conducting a repeated cross-sectional study of over 13 million enrollees aged 55 to 64 years across all 50 states and Washington, D.C. These enrollees were covered by employer-sponsored insurance plans from four major national payers — a group representing approximately one-third of the U.S. employer-sponsored insurance population.
Linear regression models estimated the relationship between county-level ACO and MA penetration and five key outcomes: influenza immunization rates, breast cancer screening, colorectal cancer screening, emergency department (ED) visits, and inpatient hospitalizations. Models controlled for enrollee characteristics, market-level factors, and county and year fixed effects to isolate within-county changes over time.
Key Findings: ACO and MA Penetration Grew Significantly
Between 2015 and 2019, Medicare value-based arrangements expanded substantially across the U.S. Median MSSP ACO penetration rose from 5.9% to 18.9%, while median MA penetration climbed from 19.5% to 26.8%. Notably, 72.1% of counties experienced increases in both ACO and MA penetration simultaneously during this period.
Despite this significant expansion, the impact on commercially insured populations was remarkably limited:
Preventive Care: A 10-percentage point increase in ACO penetration was associated with only a 0.13-percentage point increase in influenza immunization rates and a 0.29-percentage point increase in breast cancer screening among women — statistically significant but economically negligible changes relative to sample means.
Colorectal Cancer Screening: Higher MA penetration was associated with a modest decrease in colorectal cancer screening rates, suggesting potential negative spillover effects in some contexts.
Emergency Department Visits: Both higher ACO and MA penetration were associated with very small increases in ED visit probability — increases of less than 0.5% and 1.7% relative to mean rates, respectively.
Hospitalizations: Higher MA penetration was weakly associated with a marginally greater probability of inpatient hospitalization, while ACO penetration showed no significant association.
Why Aren’t Spillovers Materializing?
The study authors offer several explanations for the limited spillover effects observed.
Misaligned Financial Incentives: MSSP ACOs and MA plans are designed around Medicare-specific quality metrics and payment structures. Providers serving both Medicare and commercial patients face competing incentive frameworks, making it difficult to scale interventions uniformly across patient populations. When Medicare programs reduce hospital utilization, hospitals facing declining Medicare revenue may have less motivation to reduce services for commercially insured patients — potentially even increasing volume to offset losses.
Population Differences: Medicare patients are older and typically have more complex health needs compared to commercially insured adults aged 55 to 64. Interventions and care pathways optimized for Medicare beneficiaries may not translate effectively to younger, lower-risk commercial populations, even when both groups are eligible for the same preventive services under clinical guidelines.
Fragmented Payment Systems: The absence of multipayer alignment — where multiple payers adopt similar value-based payment innovations simultaneously — means providers must navigate different quality measures, reporting requirements, and financial incentive structures across their patient panels. This fragmentation increases administrative burden and may deter broad quality improvement efforts that extend across all patients regardless of payer.
The Case for Multipayer Alignment
These findings underscore a critical policy priority: advancing multipayer alignment to amplify the benefits of value-based payment reform. Initiatives like CMS’s Universal Foundation — a streamlined set of quality measures designed for cross-payer adoption — represent a promising step. Additionally, CMS mandates for electronic clinical quality measure reporting for ACOs starting in 2025, and expanded Medicare Advantage data transparency requirements, may provide researchers and policymakers with better tools to assess and improve cross-payer spillover effects in the future.
Study Limitations and Future Directions
The study acknowledges important limitations, including reliance on county-level ACO penetration data due to the absence of clinician-level participation data, potential confounding from unobserved enrollee and market characteristics such as race and ethnicity, and the exclusion of post-2019 data to avoid COVID-19-related disruptions. Future research should use more recent data as ACO and MA penetration has continued to grow, potentially generating stronger incentives for multipayer benefit extension.
Conclusion: Spillovers Remain Limited Without Aligned Incentives
This large-scale study provides important evidence that the substantial growth of MSSP ACOs and Medicare Advantage from 2015 to 2019 did not translate into meaningful improvements in preventive care use or reductions in hospital and emergency department utilization among commercially insured adults. The findings highlight that value-based care gains remain largely siloed within Medicare unless payer incentives are deliberately aligned. Strengthening multipayer frameworks will be essential for realizing the full societal potential of ongoing payment reform efforts across all insured populations.
