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CMS names 32 Pioneer ACOs

by Brendon Nafziger, DOTmed News Associate Editor | December 19, 2011
More than two dozen health care organizations bested their rivals to earn a spot in a competitive cost-savings program that hopes to get providers to work together to control rising health care costs and improve patients outcomes.

On Monday, the Centers for Medicare and Medicaid Services named 32 Pioneer Accountable Care Organizations, groups that will try to better encourage physician cooperation while taking steps away from Medicare's fee-for-service payment model. The Department of Health and Human Services estimates the program could save CMS $1.1 billion over the next five years.

Organizations that snagged a spot include the Seton Health Alliance, which operates in 11 counties near Austin, Texas, Beth Israel Deaconess Physicians Organization in Eastern Massachusetts, and the University of Michigan in Southeastern Michigan.

Unlike the Medicare Shared Savings Program for ACOs announced by CMS in October, the Pioneer ACO model is a tad riskier for participating groups, and CMS says the groups have more experience with "ACO-like arrangements."

For the first two years of the program, the shared savings and losses are higher than with the other system. And for the third year, ACOs that have realized savings can move to a population-based model. As CMS describes it, these groups could get a prospective, per-beneficiary monthly payment to replace all, or part, of the fee-for-service payments. CMS said this could then give the participating ACOs a chance to get reimbursed for services not "normally reimbursable" under Medicare, such as phone consults and telehealth programs.

The performance period for the program starts Jan. 1.

"We know that health care providers are at different stages in their work to improve care and reduce costs," Marilyn Tavenner, CMS' acting administrator, said in a statement. "That's why we've developed a menu of options for Medicare to meet doctors, hospitals and other health care providers where they are, and begin the conversation of how to enhance the care they are offering to people with Medicare."

It was a competitive program. In a FAQ on its website, CMS said it received 160 letters of intent and 80 applications from groups wanting to be Pioneer ACOs.

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