Skip to main content
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Opinion
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top Innovators
    • Diversity in Healthcare
      • - Luminaries
      • - Top 25 Diversity Leaders
      • - Leaders to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Digital Health Transformation Summit
    • ESG: The Implementation Imperative Summit
    • Leadership Symposium
    • Social Determinants of Health Symposium
    • Women Leaders in Healthcare Conference
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Diversity Leaders Gala
    • Top 25 Women Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Hospital at Home
    • - Workplace of the Future
    • - Digital Health
    • - Future of Staffing
    • - Hospital of the Future (Fall)
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
  • Data Center
    • Data Center Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Safety & Quality
July 16, 2013 01:00 AM

Why one Medicare Pioneer ACO failed to save money

Melanie Evans
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    (This story was corrected on July 18, 2013.)

    Atrius Health, an alliance of several physician practices in eastern Massachusetts, is one of nearly two dozen accountable care organizations that agreed to stick with Medicare's test of the promising but unproven model.

    Atrius is also one of two organizations to see a financial loss during the experiment's first year, according to preliminary results.

    Beginning in the second year, all Pioneer ACOs in the CMS Innovation Center's Pioneer ACO Model must pay Medicare back if spending accelerates beyond a target. Some Pioneer ACOs opted for payments in year one with no risk for losses. Atrius, though, may owe Medicare $2 million for the first year, according to an estimate, said Emily Brower, executive director for Atrius' accountable care programs.

    Atrius found savings more difficult to come by than others because of Medicare's extremely low budget” for the ACO to begin with, said Dr. Gene Lindsey, president and CEO for the network of multispecialty physician groups. Atrius had already adopted cost-control measures that left the organization without easy savings.

    Related Content

    Why one Medicare Pioneer ACO succeeded in saving money

    CMS names ACOs leaving Pioneer program

    Financial results were mixed for Medicare's first test of accountable care, known as the Pioneer ACO Model and administered by the CMS Innovation Center. The effort began in January last year with 32 organizations deemed by the CMS to have the right infrastructure and expertise in place. This week, nine said they would exit, including some that said the risk of future financial losses under the model was too great.

    Some did see gains. In results released today, the CMS said 13 of the ACOs saved Medicare enough to earn bonuses that totaled $76 million. Another five generated some savings, but not enough to earn bonuses.

    Financial payouts are determined by how much ACOs save Medicare and whether they meet certain quality performance criteria. ACOs earn bonuses when Medicare spending for enrollees slows against a target enough to exceed a target that also factors in expected yearly changes in spending growth.

    Atrius' financial hit in the short term obscures the progress it made to improve healthcare quality and efficiency, he said. More recent performance better reflects those gains, said Lindsey, and in coming years, early and unprofitable investments are expected to deliver a financial return.

    “Our objectives were not to do well in a particular financial cycle,” Lindsey said. “We believe the payoff is going to be the accumulated clinical transformation.

    Meanwhile, other patients have also benefited from Atrius' efforts to prevent costly hospital care and better coordinate primary care and home-care services, he said. Brower said the ACO has seen improved quality and lower costs among patients at high risk for costly acute care.

    Before the Medicare Pioneer contracts end, Atrius is expected to recoup any losses and investments that were made to launch accountable care. Lindsey said he was pleased with quality gains and the ACOs improving fortunes in the second year. “It looks as though approaching this as an investment will pay off.”

    Follow Melanie Evans on Twitter: @MHmevans

    (This story has been updated to indicate that the Atrius alliance doesn't include a hospital.)

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Cleveland-clinic-for web_i.jpg
    Increase in hospital police forces brings criticisms, warnings
    home-infusion
    Rise in home infusion therapy leads to questions on safety, cost
    Most Popular
    1
    More healthcare organizations at risk of credit default, Moody's says
    2
    Centene fills out senior executive team with new president, COO
    3
    SCAN, CareOregon plan to merge into the HealthRight Group
    4
    Blue Cross Blue Shield of Michigan unveils big push that lets physicians take on risk, reap rewards
    5
    Bright Health weighs reverse stock split as delisting looms
    Sponsored Content
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Opinion
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • Data Center
      • Data Center Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing