Measuring the association of Medicaid Accountable Care Organizations on total cost of care across the perinatal period.

INTRODUCTION: Medicaid programs have increasingly adopted value-based payment models, such as Accountable Care Organizations (ACOs), to improve quality of care and contain costs. Some evidence suggests that Medicaid ACOs have improved outcomes, but little is known about impacts on costs, including for maternity care, which comprises a large portion of Medicaid spending. METHODS: Leveraging a natural experiment in Massachusetts, we evaluated the effects of Medicaid ACOs on total cost of care across the prenatal, delivery, and postpartum periods, including cost subcategories. Using claims data on 150 879 Medicaid-covered live deliveries, we used a difference-in-differences approach to compare costs before (quarter [Q] 1 2016 through Q4 2017) vs after (Q2 2018 through Q1 2023) Medicaid ACO implementation, among Medicaid ACO vs non-ACO deliveries, controlling for patient characteristics. RESULTS: Results showed that the Medicaid ACO was not associated with statistical change in total cost of care across the perinatal period. Analysis of cost subcomponents found that the Medicaid ACO was associated with a 5% increase in inpatient delivery costs ($747) and a 21% decrease in emergency department costs (-$69). CONCLUSION: Expanding Medicaid ACOs may be a mechanism for improving care quality without increasing costs.