Jul 02, 2013 (12:07 PM EDT)
9 Pioneer ACOs Expected To Leave Medicare Program

Read the Original Article at InformationWeek

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8 Accountable Care Organizations Worth Closer Examination
8 Accountable Care Organizations Worth Closer Examination
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The revelation that nine of the 32 accountable care organizations in Medicare's Pioneer program might leave it -- four of them to join the regular Medicare shared savings program (MSSP) -- has raised some eyebrows in the healthcare industry.

The reason is that the Pioneer ACOs, which are among the most advanced healthcare organizations, are expected to take downside risk -- meaning they can lose money -- sooner than the ACOs in the MSSP, which have only upside risk -- meaning they share savings but not losses -- for the first three years. So the departure of nearly a third of the Pioneers would raise some questions about the viability of the government's plan to get providers to take financial responsibility for care.

Tom Cassels, leader of the healthcare advisory board of The Advisory Board Co., told Information Week Healthcare that the exit of the nine Pioneer ACOs, which has been confirmed by the Centers for Medicare and Medicaid Services (CMS), is not terribly significant. For one thing, he noted, the Pioneer ACOs also have risk contracts with commercial payers, self-insured employers and Medicaid plans. So their departure from the Pioneer program doesn't mean that they're shifting back to a fee-for-service system, he said.

[ Need ACO guidelines? Read Will Doctors 'C' The Way To Accountable Care? ]

The decisions of some Pioneers to stay in the program and others to leave it are all very individual, Cassels said. "It could be related to the makeup of their Medicare populations and the complexity of managing those populations with the levers they had available to them."

Medicare patients tend to be relatively high-cost patients with multiple comorbidities that are hard to manage. Depending on how many high-risk patients a given ACO has, he noted, it might be more or less difficult to make money on a Pioneer contract.

In addition, he pointed out, any provider organization that takes financial risk needs three tools to succeed: care management, network management and plan management. While CMS' ACO programs encourage the use of care management tools, they allow Medicare beneficiaries in ACOs to see any providers they want, which means that the ACOs lack control over their networks. In addition, he said, they don't have the ability to offer certain benefits to promote patient engagement, as a Kaiser Permanente or a delegated-risk group in California can do.