CMS taps 32 health systems for Pioneer ACO program

The Centers for Medicare & Medicaid Services announced yesterday the 32 health systems that will participate in the Pioneer Accountable Care Organization program, which government officials say could save Medicare as much as $1.1 billion.

With the announcement CMS hopes to finally move forward with one of the cornerstone programs of its new Center for Medicare and Medicaid Innovation (CMMI), and leave behind a host of setbacks including industry backlash when it released its ACO draft rules in March and the non-participation of some of the country's best integrated health systems.

The overall goal of the program is to reward the participating healthcare providers who form ACOs based on how well they have both improved the health of their Medicare patients while simultaneously lowering the total cost of care.

"Pioneer ACOs are leaders in our work to provide better care and reduce health care costs," said Health and Human Services Secretary Kathleen Sebelius in statement announcing the Pioneer ACOs. "We are excited that so many innovative systems are participating in this exciting initiative – and there are many other ways that health care providers can get involved and help improve care for patients."

The launch of the program was not without its hiccups throughout the year. In March, when CMS released its preliminary ACO regulations, they were widely panned by the healthcare community as being both too vague and too complex. In response to the first iteration of regulations, the Medical Group Management Association told CMS that as many as 90 percent of its members would likely not participate in the Medicare ACO program because the reporting requirements were too cumbersome and it had concerns that the regulation contained penalties for participants who were not able to achieve cost savings.

Then in late summer it came out that four of the preeminent healthcare systems in the country had declined to apply for the Pioneer ACO program. Those systems, the Mayo Clinic, the Cleveland Clinic, Geisinger Health System and Intermountain Healthcare, are often touted among the "poster boys" for care quality and cost controls many want to see in a revamped national healthcare system.

While it may be that the Pioneer ACO program did not offer enough incentive to attract the best of the best, the Pioneer program is not the only way for providers to set up and participate in developing new payment and healthcare models. In addition to the Pioneer program, CMS has its ACO Shared Savings Program. The agency will announce participants in this program in January. Many other providers are also participating in ACOs through collaborations with private payers, such as Cigna, Aetna and Wellpoint. Still other health networks are exploring shared savings through the Physician Group Practice Demonstration, also run by CMS, which will continue for another two years.

Of the 32 groups announced yesterday for the Pioneer ACO program, there is a broad cross section of providers ranging in both size and located in both urban and rural settings. Among the 32 selected are Dartmouth-Hitchcock Medical Center in New Hampshire and the University of Michigan Medical Center in Ann Arbor, Mich. California has six participating provider groups and Massachusetts counts five.

For participating providers, taking part in the Pioneer ACO initiative is one path to revamping how they deliver care, while also having access to Medicare claims data to help inform how they will set up their delivery system.

Which is why Minnesota-based Allina Hospitals & Clinics and one of the 32 wanted to participate in the program. "Allina's goal is to lead a transformation that will result in better care for individual patients, better health for our communities and affordable care for all," said Penny Wheeler, MD, Allina chief clinical officer.