That means the Pioneer ACOs are expected to accept downside risk in year three.
The timing of these departures may provide some clue as to why the ACOs are taking this step. Nate Kaufman, managing director of Kaufman Strategic Advisors, a San Diego-based consulting firm that works with several ACO clients, bluntly assessed the situation. "They've learned that they probably won't be successful, so they want to move into a no-risk environment."
Describing the ACO program as "fundamentally flawed," Kaufman attributes the problems to a lack of control over where patients seek care, which can limit savings. Two of his clients participate in the ACO program. When they received Medicare data about the patient attributed to them for savings calculations they noticed that 45% of the patients had sought care from non-ACO providers.
Trouble has been brewing within the Pioneer program for months. In a Feb. 25 letter to Richard Gilfillan, MD, director of the CMS Innovation Center, the 32 Pioneers sent expressed their displeasure with 2013 quality benchmarks for the Pioneer ACO initiatives, particularly the flat percentage benchmarks proposed for 19 of the 31 measures, which according to the letter "are higher than the standards set in commercial contracts and in Medicaid."
Bonuses would be based on the ability to meet the benchmarks this year, and the letter requested that CMS hold "Pioneers in reporting-only status for performance year 2013." It closed with a now-ominous request that CMS respond by early April so "we can make informed decisions regarding our ongoing participation."
In a response letter dated April 23, CMS said it designated the flat percentage benchmarks because of "a lack of available national Medicare FFS data to design empirically based benchmarks." With the timely data submissions of more than 200 organizations through the Physician Quality Reporting System and the ACO Group Practice Reporting Option, CMS would use that information to "empirically set quality benchmarks," which would still apply for 2013, the letter stated.