Exclusive: Pioneer ACO optimistic about bonus

January 11, 2012

The CEO of an accountable care organization participating in a U.S. Department of Health and Human Services initiative says he is confident his network of 180 primary care physicians will earn a cost-savings incentive throughout the 3-year program.

The chief executive officer (CEO) of one of the healthcare systems participating in the primary care-led Pioneer Accountable Care Organization (ACO) Initiative says he is confident his network of 180 primary care physicians (PCPs) will earn a cost-savings incentive throughout the 3-year program started January 1 by the U.S. Department of Health and Human Services.

“We have a pretty good track record,” Marc Malloy, CEO of Renaissance Medical Management Company (RMMC), tells eConsult.

RMMC was founded in 1998 by a group of private practice physicians in Southeast Pennsylvania. In 1999, the physician-owned company linked with a Blue Cross and Blue Shield-affiliated HMO on a quality improvement initiative that transitioned to include a pay-for-performance program.

The pay-for-performance program rewards RMMC physicians with a financial incentive for reducing costs, similar to the Shared Savings Program launched  January 1 by the Centers for Medicare and Medicaid Services (CMS).

In December CMS named RMMC one of the 32 Pioneer ACOs, which like the ACOs in the Shared Savings Program, will be compensated based on reducing costs and achieving quality standards. Due to RMMC's experience with care coordination, it could earn a greater level of shared savings or suffer greater losses than ACOs in the standard Shared Savings program. In the third year, Pioneer ACOs will have the option to move to a capitated monthly payment for the patients they treat.

“We’re delighted to be a part of this group,” Malloy says. “What really delineates Pioneers from the rest of the Shared Savings Program is that it’s less about the economics and more about what our [quality] goals and objectives are. All of us are coming at it from different perspectives and experiences. What’s great about that is we’ll learn from each other about what works really well.”

All RMMC physicians work in independent practices and are integrated clinically through the company’s electronic population management tool. Their coordinated care nurses, who serve all the practices, help patients follow their management plans and overcome adherence obstacles.

Malloy says the similarities between RMMC’s model and the CMS Pioneer ACO program requirements motivated the company’s physician-directors to apply for the program.

“This is well within our wheelhouse and what we’ve been doing over the last 11 years,” Malloy says. “We have the skillset, people, and technology to make it all happen.”

Most Pioneer ACOs were launched by integrated hospital systems with employed primary care physicians. Not so with RMMC. Its ACO does not have a formal agreement to share its CMS incentive with any specialty practices or hospitals in its region. RMMC’s ACO may be expanded in the future to include those provider types, Malloy said. Less than 2 weeks into the program, it’s doing pretty well on its own.

“As a PCP organization, we don’t have to worry about the impact of avoided revenue because we don’t own a hospital,” he says. “What we try to do is make sure the patients are following their plans of treatment and they understand their plan[s] of care. Therefore, their demand for services will be reduced, and so the intersection of quality and cost is actually a positive relationship.”

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