	Background

		Timeline and Goal of Pioneer ACO Model

The Pioneer ACO Model’s overall goal is to improve the delivery of  Medicare services by reducing expenditures while preserving or  enhancing the quality of care for patients. CMS designed the model for  organizations with experience in providing coordinated care to  beneficiaries at a lower cost to Medicare. Quality performance standards. ACOs must also  meet performance standards for quality. CMS’s Oversight and Evaluation Responsibilities

CMS’s oversight and evaluation responsibilities are broadly defined in the  contract between CMS and the Pioneer ACOs and in regulation. Under this provision, CMS is responsible for evaluating  models to test innovative payment and service delivery, such as the Pioneer ACO Model. CMS calculates a dollar amount for each ACO’s final annual payment if  the ACO generates shared savings or losses. 1.) Fewer Than Half of Pioneer ACOs Earned Shared Savings in First and Second Years, and the Pioneer ACO Model Produced Net Shared Savings

Fewer than half of the ACOs that participated in the Pioneer ACO Model  in 2012 and 2013—the first two years of the model—earned savings that  were shared with CMS. Of the 23 ACOs that participated in 2013, 11 (48 percent) produced about  $121 million in total shared savings. The amount of shared savings that  the 13 ACOs produced in 2012 ($139 million) and the amount the 11  ACOs produced in 2013 ($121 million) each represent about 4 percent of  the total expenditures for the ACOs that produced shared savings in each  year. For example, in 2012, CMS paid 13 ACOs   $77 million of the $139 million that they produced in shared savings. ACOs Had Significantly Higher Quality Scores in the Second Year for Two- Thirds of the Quality Measures

The 23 ACOs that participated in the Pioneer ACO Model in both 2012  and 2013 had significantly higher quality scores in the second year than  in the first year for two-thirds of the quality measures (22 of the 33, or   67 percent) that they reported to CMS. CMS Oversees Beneficiary Service Use and Quality, and Has Reported Some of Its Evaluation Findings Publicly

CMS oversees Pioneer ACOs by monitoring the service use of their  aligned beneficiaries and the quality of care provided by the ACOs, and  by investigating provider and beneficiary complaints about ACOs. As  provided for by law, CMS has reported its evaluation findings publicly for  the first year of the Pioneer ACO Model in 2013, and these findings  addressed two of the eight research areas that CMS established for the  evaluation. As of February 2015,  CMS officials indicated that they had examined two reports about  potentially discrepant trends in beneficiaries’ use of services. CMS also oversees Pioneer ACOs by monitoring their compliance with  the model’s quality performance standards, consistent with the contract  between CMS and the ACOs and CMS regulation. CMS determined that one ACO did not  meet the quality performance standards in the second year of the model,  because it did not meet the minimum standard in the care coordination  and patient safety domain. As a result, CMS required the ACO to submit a corrective action plan to  CMS. Based on its monitoring efforts, CMS has no substantiated evidence  suggesting that beneficiary care has been compromised, as of February  2015. CMS Has Reported Evaluation Findings Publicly for the Pioneer ACO Model on Medicare Service Use and Expenditures and ACO Characteristics

As provided for by law, CMS has reported its evaluation findings publicly  for the first year of the Pioneer ACO Model. In 2015, CMS also plans to report additional findings for the first year of the model. Agency Comments

The Department of Health and Human Services (HHS) reviewed a draft of  this report and provided written comments, which are reprinted in  appendix II. HHS also provided technical  comments, which we incorporated as appropriate. Appendix I: Quality Scores for Pioneer Accountable Care Organizations (ACO) in 2012 and 2013

This appendix presents information on the distribution of scores for the 33  quality measures that 23 Pioneer ACOs reported to CMS in 2012 and  2013.
Why GAO Did This Study

ACOs were established in Medicare to provide incentives to physicians and other health care providers to better coordinate care for beneficiaries across care settings such as doctors' offices, hospitals, and skilled nursing facilities. The Pioneer ACO Model was established as a result of the Patient Protection and Affordable Care Act of 2010 creating CMMI in CMS to test new models of service delivery in Medicare. Thirty-two ACOs joined the model in 2012, the first year. Under the model, CMS rewards ACOs that lower their growth in health care spending while meeting performance standards for quality of care.
GAO was asked to review the results of the Pioneer ACO Model and CMS's oversight of the ACOs. In this report GAO (1) describes the financial and quality results for the first two years of the model and (2) examines how CMS oversees and evaluates the model.
To do this work, GAO analyzed data from CMS on the financial and quality results for each ACO for 2012 and 2013 (the first two years of the model). GAO analyzed ACOs' expenditures, spending benchmarks, the amount of shared savings and losses, and payment amounts for shared savings or losses. GAO also reviewed relevant laws, regulations, and documents describing CMS's oversight and evaluation role and interviewed CMS officials about the agency's oversight and evaluation activities.

What GAO Found

Health care providers and suppliers voluntarily form accountable care organizations (ACO) to provide coordinated care to patients with the goal of reducing spending while improving quality. Within the Centers for Medicare & Medicaid Services (CMS), the Center for Medicare & Medicaid Innovation (CMMI) began testing the Pioneer ACO Model in 2012. Under this model, ACOs can earn additional Medicare payments if they generate savings, which are shared with CMS, but must pay CMS a penalty if their spending is higher than expected. ACOs must report quality data to CMS annually and meet quality performance standards.
GAO found that fewer than half of the ACOs earned shared savings in 2012 and in 2013, although overall the Pioneer ACO Model produced net shared savings in each year. Specifically,
Forty-one percent of the ACOs produced $139 million in total shared savings in 2012, and 48 percent produced $121 million in total shared savings in 2013.
In 2012 and 2013 CMS paid ACOs $77 million and $68 million, respectively, for their shared savings.
The Pioneer ACO Model produced net shared savings of $134 million in 2012 and $99 million in 2013.
GAO also found that ACOs that participated in both years had significantly higher quality scores in 2013 than in 2012 for 67 percent of the quality measures.
CMS oversees the use of Medicare services by beneficiaries receiving their care from ACOs and the quality of care that ACOs provide, consistent with the contract between CMS and ACOs and CMS regulation, and has reported publicly on findings from its evaluation of the model. CMS reviews reports on each ACO's service use, expenditures, and quality performance and investigates complaints about ACOs. As of February 2015, CMS officials said the agency had investigated two potentially discrepant trends in service use. CMS determined that one ACO did not meet the quality performance standards in 2013, and, as a result, CMS is requiring it to implement an action plan to ensure future compliance. Based on its monitoring efforts, CMS has no substantiated evidence suggesting that beneficiary care has been compromised, as of February 2015. CMS reported publicly on its evaluation findings, as provided for by law, in 2013. CMS included in this initial report findings related to Medicare service use and expenditures and ACO characteristics—two of the eight research areas that it established for the evaluation. CMS officials told GAO that the agency has shared preliminary findings within CMS for five of the six remaining areas and that it plans to report publicly on additional findings in 2015.
In commenting on a draft of this report, the Department of Health and Human Services (HHS) emphasized the overall goal of the Pioneer ACO Model. HHS also provided technical comments that GAO incorporated as appropriate.