Pioneer ACOs Will Move To Performance-Based Payments In 2013 As Planned

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Reprinted in partnership with The American Health Lawyers Association 

May 2013—The Centers for Medicare & Medicaid Services (CMS) said in an April 23 letter that payments to Pioneer Accountable Care Organizations (ACOs) will be tied to performance-based benchmarks in 2013 as scheduled.

At the same time, the agency said it intended to use “empirically set quality benchmarks” based on actual ACO experience rather than “flat percentage benchmarks” in scoring measures.

“We intend to issue proposals in the near future detailing how we would include 2012 data reported by ACOs to establish the Shared Savings Program benchmarks for 2014,” the letter said. “We also intend to modify the Pioneer agreements to indicate the benchmark methodology adopted for Shared Savings Program for 2014 will be used to calculate the Pioneer benchmarks for 2013.”

The Pioneer ACO initiative is an offshoot of the Medicare Shared Savings Program created by the Affordable Care Act under which ACOs agree to be accountable for the quality, cost, and overall care of the Medicare fee-for-service beneficiaries assigned to the organization.

ACOs that meet specified quality performance standards will be eligible to receive a share of any savings if the actual per capita expenditures of their assigned Medicare beneficiaries are a sufficient percentage below benchmark amounts CMS sets.

The Pioneer model provides a faster path for mature ACOs that already have started coordinating patient care and are ready to move forward. Pioneer ACOs are intended to have a higher level of shared savings and risk than those ACOs participating in the Shared Savings Program.

“Because of the greater rewards, we believe that Pioneer ACOs should be moving more rapidly than ACOs in the Medicare Shared Savings Program toward improvements in care for Medicare beneficiaries and testing innovations that may be adopted more broadly in our programs,” the letter said.

“For this reason, CMS will continue toward implementing the previously agreed upon phase in of pay-for-performance for the quality measures and intends to use actual Medicare fee-for-service (FFS) and Medicare Advantage(MA) performance data in establishing ACO quality performance benchmarks.”

This article appeared in the Health Lawyers Weekly, April 26, 2013, and is reprinted here with permission.  Copyright American Health Lawyers Association (AHLA) 2013.  No further distribution of the article is allowed without express permission of AHLA.  Please visit their website at for more information about this topic.

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