Results Announced from the First Performance Year of Pioneer ACOs, 23 out of 32 Pioneers Remain

CMS has announced its results from the first performance year of the Pioneer Accountable Care Organization (ACO) Model. Out of the original 32 pioneer ACOs, 23 remain in the model. Seven of the original pioneer ACOs opted to apply to participate in the Medicare Shared Saving Program rather than continue in the Pioneer Model, as they did not produce savings. Two others will leave the program completely.


The Pioneer ACO model stemmed from the creation of accountable care organizations under sec. 1899 of the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148), which aims to coordinate care, and promote accountability, among providers, and to garner high quality and efficient care for Medicare beneficiaries. ACOs, being groups of provider that come together and agree to provide high quality care while saving money for the Medicare program (the savings from which is shared with the participating ACOs), could apply to take part in the Pioneer ACO Model or the Medicare Shared Savings Program (MSSP), for example. Participating in the Pioneer ACO Model, rather than the MSSP, could net a higher level of shared savings and risk for the ACO for the first two years of participation. Then in the third year, those that achieved a certain level of savings will be eligible to transition to a population-based model.

The Savings

A recent Medicare Trustees Report noted that Medicare spending growth has slowed, and is anticipated to keep slowing over the next few years. The CMS press release stated that for those nearly 670,000 beneficiaries treated under pioneer ACOs, their Medicare costs increased by only 0.3 percent in 2012, compared to 0.8 percent for other beneficiaries. Shared savings were realized for 13 of the 32 Pioneer ACOs, saving Medicare Trust Funds almost $33 million and earning $76 million for the pioneer ACOs.  Two pioneer ACOs shared a loss with CMS, totaling $4 million.

The Quality

All 32 of the pioneer ACOs reported quality measures as required for the first performance year, which earned them all incentive payments for reporting, and in many case performed even better than rates in fee-for-service (FFS) Medicare. CMS lauded the high quality care that was provided by the pioneer ACOs, including: (1) 25 of the pioneer ACOs generated lower readmission rates than was seen for all FFS beneficiaries; (2) performing better on quality measures to assess hypertension control (68 percent compared to 55 percent in cross-section of the adult diabetic population); and (3) performing better in cholesterol control for diabetic patients (57 percent compared to 48 percent).