Major IDNs decline to apply for Pioneer program
The Mayo Clinic, the Cleveland Clinic, Geisinger Health System and Intermountain Healthcare have repeatedly been touted as models for a new healthcare delivery system. Yet all four have declined to apply for the “Pioneer” program tailor-made by the Obama administration to reward such organizations.
Michael Millenson, president of Health Quality Advisors LLC, says the lack of participation suggests “somebody messed up": either the government didn’t make the rules appealing enough, or “when push came to shove, the big players didn’t want to play by the rules.”
The four health systems are considered the most promising models for “accountable care organizations,” an approach to delivering healthcare services that rewards doctors and hospitals for providing high-quality care to Medicare beneficiaries while keeping costs down. The ACO provision became one of the most highly anticipated elements of the healthcare overhaul.
But when the proposed regulation for the program was announced in March, excitement faded. Hospital and physician groups complained that the program created more financial risks than rewards and imposed onerous reporting requirements.
The American Medical Group Association, which represents nearly 400 large provider organizations, warned CMS that more than 90 percent of its members would not participate because of the reporting requirements and financial disincentives. In particular, the proposed rule would impose penalties for ACOs that do not achieve savings.
In response, HHS announced the Pioneer program in May, promising it would “provide a faster path for mature ACOs” that would allow the high-performing health systems to retain more of the expected savings in exchange for taking on greater financial risk. HHS estimated that the Pioneer program could save Medicare as much as $430 million over three years.
CMS has not revealed how many health systems applied for the program by the Aug. 19 deadline.
The Advisory Board Company, a hospital consulting firm, estimates that between 30 and 50 organizations have applied for the Pioneer program, based on informal surveys of clients and conversations with Innovation Center employees, said Chas Roades, Advisory Board’s chief research officer. CMS hoped to have 30 health systems participate in the Pioneer program.
Daron Cowley, a representative for Intermountain, says the health system decided not to apply because “the ACO regulations fell short of the goals that had been set, especially as it pertains to institutions that already are organized to coordinate care.” Geisinger and some of the other leading organizations decided to remain in the Physician Group Practice Demonstration instead for another two years.
Jeff Ruggiero, general counsel to the Queens County Medical Society in New York, says others are waiting to see what will be included in the final ACO Shared Savings regulation and may apply to become ACOs under those rules. Others are choosing to form ACOs with private payers rather than Medicare.
Susan DeVore, president and CEO of Premier healthcare alliance, says 77 of its member health systems are choosing among the many options for forming integrated systems, including medical homes and arrangements with private payers.
CMS intends to announce the Pioneer ACOs before the Shared Savings program launches in January.
This article was reprinted from Kaiser Health News, an editorially independent news service and a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.
