Pioneer ACOs Exit the Program

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On July 16, 2013, the Centers for Medicare and Medicaid Services (CMS) announced the first year results from its Pioneer Accountable Care Organization (ACO) program. The program, launched by the CMS Innovation Center, is part of the Affordable Care Act’s efforts to promote lower cost, high quality, coordinated care for Medicare beneficiaries. In 2012, there were 669,000 beneficiaries assigned to the program.

The Pioneer ACOs earned over $76 million dollars in 2012. Of the thirty-two ACOs enrolled in the program, thirteen produced gross Medicare savings of $87.6 million dollars. This equals total savings to the Medicare program of $33 million dollars. Two of the Pioneer ACOs shared losses totaling about $4.0 million. CMS called the results “positive and promising.”

CMS indicated that the costs for the Pioneer ACO program beneficiaries grew by 0.3% in 2012, compared with 0.8% for other similar beneficiaries. All thirty-two of the Pioneer ACOs earned incentive payments for reporting quality measures, performing better overall on fifteen clinical quality measures for which comparable fee-for-service data are available. For example, twenty-five Pioneer ACOs generated lower risk-adjusted readmission rates for their aligned beneficiaries than the benchmark rate for all Medicare fee-for-service beneficiaries. Further, the Pioneer ACOs were rated higher by ACO beneficiaries on all four patient experience measures relative to the 2011 Medicare fee-for-service results.

Seven Pioneer ACOs that did not produce savings in 2012 have notified CMS that they intend to apply to the Medicare Shared Savings Program, another ACO model. Another two Pioneer ACOs intend to leave the accountable care program altogether. CMS reported that Primecare Medical Network, University of Michigan, Physician Health Partners, Seton Health Alliance, Plus (North Texas Specialty Physicians and Texas Health Resources), HealthCare Partners Nevada ACO, HealthCare Partners California ACO, JSA Care Partners and Presbyterian Healthcare Services will not continue in the second year of the Pioneer program.

CMS expects to have the first-year Medicare Shared Savings Program results later this year.