PIONEER ACCOUNTABLE CARE ORGANIZATION MODEL

The Pioneer ACO Model is a CMS Innovation Center initiative designed to support organizations with experience operating as Accountable Care Organizations (ACOs) or in similar arrangements in providing more coordinated care to beneficiaries at a lower cost to Medicare.  The Pioneer ACO Model will test the impact of different payment arrangements in helping these organizations achieve the goals of providing better care to patients, and reducing Medicare costs.

Accountable Care Organizations

Accountable Care Organizations (ACOs) are one way CMS is working to ensure better health care, better health, and lower growth in expenditures through continuous improvement.

The Medicare Shared Savings Program provides incentives for ACOs that meet standards for quality performance and reduce cost while putting patients first. Established by the Affordable Care Act, CMS published final rules for the Shared Savings Program on November 2, 2011. More information is available at www.cms.gov/sharedsavingsprogram. 

Working in concert with the Shared Savings Program, the Innovation Center is testing an alternative ACO model, the Pioneer ACO Model. The Innovation Center is also testing the Advance Payment ACO Model, which will provide additional support to physician-owned and rural providers participating in the Shared Savings Program who would benefit from additional start-up resources to build the necessary infrastructure, such as new staff or information technology systems.

More information on all of these initiatives is available on the Innovation Center website at www.innovations.cms.gov.

The Pioneer ACO Model and Selected Organizations

The Pioneer ACO Model was designed specifically for organizations with experience offering coordinated, patient-centered care, and operating in ACO-like arrangements.  The selected organizations were chosen for their significant experience offering this type of quality care to their patients, along with other criteria listed in the Request for Applications (RFA) document available at www.innovations.cms.gov.  These organizations were selected through an open and competitive process from a large applicant pool that included many qualified organizations. 

The 32 organizations participating in the Pioneer ACO Model:

The Innovation Center

The Innovation Center was created by the Affordable Care Act to test new models of health care delivery and payment. The Center also offers technical support to providers to improve the coordination of care and share lessons learned and best practices throughout the health care system. It is committed to refining the Medicare, Medicaid and CHIP programs to deliver better care for individuals, better health for populations, and lower growth in expenditures.

Payment Arrangement and Beneficiary Alignment

The first performance period begins in January 1st, 2012.  In the first two performance years, the Pioneer Model tests a shared savings and shared losses payment arrangement with higher levels of reward and risk than in the Shared Savings Program. These shared savings would be determined through comparisons against an ACO’s benchmark, which is based on previous CMS expenditures for the group of patients aligned to the Pioneer ACO

In year three of the program, those Pioneer ACOs that have shown savings over the first two years will be eligible to move to a population-based payment model. Population-based payment is a per-beneficiary per month payment amount intended to replace some or all of the ACO’s fee-for-service (FFS) payments with a prospective monthly payment.

Additionally, during the application process, organizations were invited to propose alternative payment arrangements.  CMS established two alternatives to the core payment arrangement discussed above based on this input.  Both of these alternatives follow a shared savings model in years one and two, and provide an option for a partial population based payment that removes limits on rewards and risks in year three.   These arrangements will allow Pioneer ACOs more flexibility in the speed at which they assume financial risk. 

Under the Pioneer ACO Model, CMS will prospectively align beneficiaries to ACOs, allowing care providers to know at the beginning of a performance period for which patients’ cost and quality they will be held accountable.

Beneficiary Protections and Quality Measures

Providing the beneficiary with a better care experience is one of the central focuses of the Pioneer ACO Model.  Under the Pioneer ACO Model, beneficiaries will maintain the full benefits available under traditional Medicare (fee-for-service), as well as the right to receive services from any healthcare provider accepting Medicare patients.

To ensure beneficiaries receive high quality care and enjoy a positive experience, CMS has established robust quality measures that will be used to monitor the quality of care provided and beneficiary satisfaction.  These measures mirror those in the Shared Savings Program.  For more information, visit www.cms.gov/sharedsavingsprogram and view the fact sheet entitled “Improving Quality of Care for Medicare Patients: Accountable Care Organizations.”

More information about beneficiary protections and quality measures is available in the fact sheet entitled “The Pioneer ACO Model: A Better Care Experience Through a New Model of Care.”

Eligibility Criteria/Program Requirements

To be eligible to participate in the Pioneer ACO Model, organizations are required to be providers or suppliers of services structured as:

1)     ACO professionals in group practice arrangements;

2)     Networks of individual practices of ACO professionals;

3)     Partnerships or joint venture arrangements between hospitals and ACO professionals;

4)     Hospitals employing ACO professionals; or

5)     Federally Qualified Health Centers (FQHC).

Health Information Technology

By the end of 2012, Pioneer ACOs must