WASHINGTON – One of the major components of the Affordable Care Act addressing the cost of care got underway Jan. 1 after the Centers for Medicare & Medicaid Services unveiled it picks for the Pioneer Accountable Care Organization program, which government officials say could save Medicare as much as $1.1 billion.
With the announcement of the 32 health systems that will participate in the program, CMS hopes to leave behind recent setbacks including industry backlash from its ACO draft regulations for the separate Shared Savings Program it released last March. CMS later revised its regulations to both simplify the program and eliminate downside risk for participants in the early stages if they fail to meet care quality or savings benchmarks.
Pioneer ACO participants won’t have such protections, and that is exactly the reason many chose the Pioneer program instead.
Penny Wheeler, MD, chief clinical officer with Allina Hospitals & Clinics in Minnesota said her system extensively modeled both the Shared Savings Program and the Pioneer program in order to chose the best fit.
“We wanted to pick the model that most clearly aligned with a new way of thinking from a financial incentive standpoint – one that gave us rewards for when we were doing things better at a lower and more affordable cost,” Wheeler said.
At Sharp Healthcare in San Diego, the decision to apply to the Pioneer program was easy “since it is the way we have been doing business as an integrated health system for the past 20 years,” noted John Jenrette, MD, CEO of Sharp Community Medical Group.
Also attractive to Sharp management was the provision in the Pioneer program to move to full global payments in the third year of the five-year program.
“Medicare Advantage and all of our commercial HMO population are paid like that. What we have found is when you have the dollars available to you that you make the best decisions about what you can provide and give for the patients,” said Jenrette. “It completely changes your thinking about how you are going to spend the dollars.”
Under the program, each of the health systems will have access to historical data on the Medicare patients that chose to participate in an ACO. The systems will also regularly share with other participants’ information and data from their programs.
That was one motivation for Eastern Maine Medical System’s participation in the program. “By being in the spotlight, or the under the microscope, we hope it allows us to transfer what we think we can accomplish to transform the way healthcare is delivered and reimbursed across the country,” said M. Michelle Wood, EMHS president and CEO.
Wood says the system she oversees also wanted to see how well it could create a fully integrated, community-based care program in a rural area that covers roughly 26,000 square miles in the northern two-thirds of Maine. “We think we have the building blocks in place to accomplish that,” added Wood. “We’ve already had some success.”
Wheeler also understands that success in the program is not a guarantee.
“I think this is about finding a new way to maximize the value to the people and community we serve,” said Wheeler. “Accountable care organization may not be the way, but it is a way to try.”