Wellness or waste? How extra visits can undermine shared savings for ACOs

In many accountable care organizations (ACOs), frontline physicians are under strong pressure to schedule Medicare annual wellness visits (AWVs) for every eligible patient. On paper, AWVs are framed as a cornerstone of value‑based care. In reality, for patients who already receive regular, well‑designed chronic care and follow‑up visits, a separate AWV can easily become cost‑ineffective. It adds encounters and expense without a clear marginal benefit, and it consumes scarce access that might otherwise prevent emergency room visits and hospitalizations.

What AWVs do (and what they don’t do)

Medicare defines the AWV as a structured preventive planning visit. It centers on the following:

• A health risk assessment
• Review and update of medical, surgical and family history
• Review and update of medication and problem lists
• Screening for depression, cognitive issues and functional risk
• A personalized prevention plan and screening schedule

An AWV does not require a comprehensive head‑to‑toe physical examination, and it does not automatically include labs or imaging. Those are ordered separately when clinically indicated, just as they would be during a routine follow‑up visit. In other words, the value of an AWV lies almost entirely in its cognitive and planning work, not in ritualized annual physical testing.

In a well‑run primary care practice, much of this cognitive work already occurs during routine chronic care, medication management and posthospital visits. When that is true, adding a separate AWV for the same patient in the same year often duplicates effort rather than improving outcomes.

For complex patients with diabetes, congestive heart failure, chronic obstructive pulmonary disease, chronic kidney disease or multiple comorbidities, it is common — and appropriate — to see them three to four times per year. At those visits, an effective team already does the following:

• Reconciles medications
• Updates the problem list and active diagnoses
• Reviews preventive and disease‑specific care gaps
• Provides risk‑factor counseling (smoking, diet, exercise, falls, etc.)

If we then layer on a dedicated AWV solely to check a billing box or satisfy a metric, we have added an entire encounter without substantially changing management. The total cost of care rises by at least the professional fee and the practice’s internal costs, while downstream utilization may remain unaffected. From a shared‑savings perspective, that extra expense must be justified by a meaningful reduction in emergency room use, admissions or high‑cost complications. For a patient who has already been seen frequently, it is far from obvious that a standalone AWV provides any incremental benefit.

Taking up limited time and resources

Primary care access is a finite resource. Every appointment scheduled for a low‑acuity, largely redundant AWV is a slot that cannot be used for these:

• A hospital follow‑up visit within seven to 14 days of discharge.
• A post‑emergency room visit to stabilize a patient and prevent readmission.
• An urgent visit for a patient with early warning signs of decompensation.

These are the encounters where primary care has the greatest leverage on cost and outcomes. Timely posthospital and post‑emergency room visits reduce readmissions, complications and high‑cost downstream use. Proactive visits for worsening but not yet catastrophic symptoms can keep patients out of the emergency room altogether. If AWVs crowd out those visits because templates and metrics demand AWV volume, then the very strategy meant to support value‑based care paradoxically increases the total cost of care.

Clinical excellence or a compliance exercise?

Another concern for frontline clinicians is that the AWV can become a compliance exercise rather than a clinical one. To bill the service, you must document a checklist of required elements. That often leads to the following:

• Long, templated notes focused on satisfying documentation rules.
• Time spent on screenings with little relevance to that specific patient’s most urgent risks.
• Less room in the visit for a nuanced discussion of pressing clinical issues.

When quality programs give explicit credit for the percentage of eligible patients with an AWV rather than for core functions (diagnosis reconciliation, immunizations, cancer screening, chronic disease control), physicians understandably feel that the system cares more about the code than the outcome. For clinicians already wrestling with burnout and documentation burden, another templated visit type that feels administratively driven rather than patient‑centered can further erode engagement.

Coding for an annual check-up or low-value care?

Patients and even some clinicians still equate wellness with an old‑fashioned annual physical: a lengthy, head‑to‑toe exam and a large panel of routine labs. Decades of evidence, however, have shown that for average‑risk adults, this ritualized annual physical provides limited benefit and can generate low‑value cascades of testing. Medicare’s AWV was designed around this evidence. It deliberately focuses on risk assessment and prevention planning rather than reflexive physical exams and blanket testing. A careful, problem‑focused exam and targeted labs when clinically indicated are far more valuable than performing a full exam and large lab battery simply because “it’s that time of year.”

When AWVs are incorrectly sold to patients or physicians as “the annual physical with lots of tests,” they invite exactly the sort of low‑value care the program was meant to avoid. For ACO physicians, the most sustainable strategy is to retain the functions of the AWV, without insisting that they occur only within a separate AWV encounter. In an efficient, team‑based model, the following occurs:

• Every chronic care, post‑emergency room and posthospital visit includes up‑to‑date problem and diagnosis lists, medication reconciliation and deprescribing opportunities, preventive and chronic disease gap review via standing orders and rooming protocols, and brief, focused risk‑factor counseling tailored to the patient.
• Nurses, medical assistants and care managers handle much of the structured screening (Patient Health Questionnaire-9, fall risk, functional assessment, tobacco status, etc.) before or between physician visits. Electronic prompts and registries identify patients with major open gaps, flagging them at the next visit type rather than waiting for a dedicated AWV. Under this design, many patients effectively receive AWV‑level preventive and reconciliation work during visits they already need for clinical reasons. The incremental value of forcing a distinct AWV appointment shrinks considerably.
• Some patients — those rarely seen, with fragmented care or minimal chronic contact — could still benefit from a dedicated AWV to re‑establish a comprehensive prevention and care‑coordination plan. But for the majority of well‑connected, chronically ill adults, the focus should be on high‑quality, multifunctional visits, not on multiplying visit types.

From the coding and risk‑adjustment perspective, this distinction matters. When an AWV is done strictly according to Centers for Medicare & Medicaid Services (CMS) specifications and no active problems are truly evaluated or managed, the only appropriate diagnosis may be Z00.00 (“encounter for general adult medical examination without abnormal findings”), which carries no hierarchical condition coding weight and offers little benefit beyond attribution. Other medical issues have often been, or should be, addressed at routine primary care or specialist visits. In that scenario, the AWV may help close some quality gaps that could easily be closed during other visits, but it does little for risk adjustment or shared savings.

Many ACOs discover that when they do a deep dive on their AWV program, they are actually losing more savings than they generate. The AWV falls between regular visits and serves as an extra encounter, yet most providers feel compelled to add a same‑day evaluation and management (E/M) code with a -25 modifier to justify additional diagnostic codes. In principle, modifier ‑25 is there for “significant and separately identifiable” problem‑oriented work; in practice, it often becomes a way to add on diagnoses that should have been, or will be, handled during routine E/M care if those conditions are truly active. That adds professional fees and audit exposure while eroding the financial value of the AWV.

Well, we’ve got to do something

In addition, AWVs often trigger unnecessary labs or other tests when clinicians feel pressured to “do something” during a wellness visit. Because the AWV itself does not inherently include lab testing, those orders should be limited to situations where they change management, just as in any other visit. When AWVs are treated as the annual excuse to repeat panels that add no new information, the net result is more cost without better outcomes.

Using an AWV as the primary vehicle for billing all active International Classification of Diseases, Tenth Revision (ICD‑10) codes is therefore a poor strategy. Diagnosis capture properly belongs in the routine visits where you are actually evaluating and managing those conditions. CMS allows billing a same‑day E/M with an AWV precisely because chronic conditions often require significant, separately identifiable work — proof that the right place to reflect those diagnoses is in problem‑focused or chronic care visits, not just in the AWV header.

AWV documentation has its own extensive requirements, and many practices already struggle to meet them. Simply pulling a long list of problem‑list diagnoses into the AWV claim without clearly addressing each one in the note does not meet requirements. Treating AWVs as the primary Hierarchical Condition Category/ICD‑10 capture event can lead to scheduling an extra, template‑heavy visit even for patients already seen multiple times a year for chronic care, adding professional fees and staff time with limited marginal clinical value. AWVs are for prevention planning, not for parking every active diagnosis once a year. If a condition is serious enough to code, it is serious enough to manage in a regular E/M visit, and that is where its ICD‑10 should live.

In an AWV, it is inherently difficult to justify the active treatment of many chronic conditions rather than simply listing them for coding, because the service is defined as preventive and planning‑focused rather than problem‑oriented. When you pull numerous chronic diagnoses into the AWV claim but do not document any change in the illness, decision‑making or treatment for each condition, the note starts to look like it was written for coding rather than for care. That gap between the AWV’s preventive intent and the appearance of broad “treatment” coding can create real problems under audit, because you cannot convincingly show that you evaluated and managed every coded condition in a preventive‑only encounter.

The solution: Embedding AWV checks into routine care

For ACO decision-makers, the message is not “don’t require AWVs,” but rather, “embed AWV content into routine care.” Train physicians and teams to treat routine follow‑up visits as opportunities to reconcile diagnoses, clean up the medication list, close care gaps and refresh the prevention plan. Provide concise checklists and electronic medical record templates that support this without bloating the note. Encourage scheduling priority for postdischarge and post‑emergency room visits, early appointments for patients with symptom escalation and chronic care reviews for those with poor control. Make it clear that these visits often have more impact on shared savings than a marginal AWV on an already‑engaged patient.

Advocate for quality dashboards that reward up‑to‑date problem lists, medication reconciliation rates, vaccination and screening completion, and chronic disease control, regardless of whether these occurred at an AWV or another visit type. Position AWVs as particularly useful for the following:

• Patients infrequently seen or new to the practice.
• Individuals with major care fragmentation, where a structured prevention and coordination visit is truly additive.
• Situations where the AWV can be efficiently team‑delivered (for example, RN‑ or NP‑led with M.D. oversight) without displacing high‑risk follow‑up.

For frontline ACO physicians, the central insight is straightforward: It is the preventive and coordination work that matters, not the billing label of the visit. When a practice is already delivering that work reliably during chronic care and follow‑up encounters, insisting on an additional, separate AWV can be cost‑ineffective and may actually undermine shared savings by consuming scarce access that could prevent more expensive events.

For low‑complexity, well‑controlled patients who already have adequate access, tacking on an additional AWV is exactly the kind of extra visit where marginal savings are minimal and the main effect is added cost and opportunity cost. When an AWV is treated as an excuse for broad “your yearly bloodwork,” it easily slides into the same low‑value category — cost added without outcome improvement. AWVs and more primary care contact clearly save money in high‑risk, underserved populations, but there are diminishing returns, and even cost increases, when you add visits for already low‑risk, well‑controlled patients. When an extra visit is mostly about satisfying a code and running low‑value tests, rather than changing management or preventing admissions, it is likely on the wrong side of that curve — added spend with little or no offsetting reduction in total cost. Given fixed capacity, each low‑yield AWV displaces higher‑yield contacts (emergency room/hospital follow‑up, unstable chronic disease), where the largest cost reductions occur.

By training clinicians and teams to include AWV functions in routine visits, carefully prioritizing access for high‑impact encounters and aligning metrics with outcomes rather than codes, ACOs can honor the spirit of Medicare’s wellness intent — better prevention and coordination — without adding unnecessary visits, costs and burnout.

Robert Resnik, M.D., MBA, is a board-certified internal medicine physician practicing in Cary, North Carolina. He earned his medical degree from Eastern Virginia Medical School and completed his residency at East Carolina University. He also holds an MBA from Duke University.