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  • Medicare Pioneer ACO Program Continues to Lose Members

    The Medicare "Pioneer" program that targets more sophisticated health systems to foster the development of accountable care organizations (ACOs) has now lost about 40% of the systems that signed on initially. According to an article in Modern Healthcare (access available via free one-time registration) the most recent withdrawals "suggest even the most sophisticated health systems may be unwilling to take losses as policymakers test new payment and delivery models."

    The most recent exits—Franciscan Alliance, Genesys PHO, and Renaissance Health Network—bring the Pioneer list from its original 32 members to 19. The Modern Healthcare article reports that 9 of the 13 ACOs that dropped out did so within the first year of the program's launch in 2012, opting instead to join the "less risky" shared savings program, the traditional Medicare program that allows other entities to form ACO. Unlike the Pioneer program, the number of entities joining the shared savings program has been steadily increasing.

    The Pioneer program was designed to help ACOs transition from a fee-for-service payment structure to improve patient care, increase Medicare savings, lower costs, and to test alternative program designs to inform future rulemaking for the Medicare Shared Savings Program. The ACOs in the Pioneer program were generally considered ones that were willing to withstand potential losses in hopes of achieving bonuses for meeting various quality and spending metrics.

    Modern Healthcare reports that while the ACO program is generally helping to set the stage for more widespread use, critics of the Pioneer program contend that Medicare's bonus formulas are "skewed in favor of [ACOs] that operate in markets that have above-average health spending, where hospitals and doctors have more opportunities for savings." The article describes how Medicare announced that its ACO initiatives saved $817 million through 2013, and how "dozens" of program participants shared in $445 million in bonuses, "but three-quarters saw nothing after failing to do sufficiently well against the financial benchmarks."

    APTA members can learn more about a physical therapist's role in an ACO by visiting APTA's webpage, FAQ: Accountable Care Organizations (ACOs): Medicare Shared Savings Program and Pioneer Models.

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