Thirty-two health systems in the United States are designated by the federal government as "Pioneer ACOs." Yesterday CMS, the agency that runs Medicare and Medicaid, announced that several of them are quitting as pioneers.
ACOs are "Accountable Care Organizations," networks of physicians and hospitals that agree to be paid according to how well their patients do overall. This sounds so common sense it's hard to believe ACOs are considered one of the great innovations of the Affordable Care Act (also known as Obamacare). But at least in theory, ACOs depart from today's status quo, where providers get paid for each service they deliver, whether the service benefited the patient or not.
Pioneer ACOs are the cream of the health care crop, the trailblazers that agreed to test this new model and even take the risk of being paid less if they fail to achieve goals for their patients. They also get millions of dollars from the taxpayers to set them up for the journey. But alas, some of those pioneers are folding up their tents and going home.
I don't think any of the 32 have yet earned the quintessentially American title of "pioneer" and recommend the administration should only award the pioneer title when these health systems actually accomplish something new -- and that hasn't happened yet.
Here's my image of a pioneer: Laura Ingalls Wilder, author of the Little House on the Prairie series of books, one of my heroes. She spent her childhood, over a century before mine, in a family of itinerate farmers and foragers, traveling in their covered wagon through uncharted, often dangerous territory.
The 1970s TV series never quite captured the downside of life on the prairie, but the books did -- and that's part of what made them such classics. Pa couldn't have a bad day and skip the chores, or the family would starve or freeze to death. Ma prepared the meat from Pa's kill at the hunt that day, and spun the fabric to sew the family's clothing. When they set out on their covered wagon for a new destination, they didn't have a road map -- or even a road. They relied on the stars in the sky and their own determination. Still, they laughed and danced, and they always seemed to be looking for the next journey, the next adventure.
Let's contrast the pioneering Ingalls family with the "Pioneer ACOs." In a March 2013 letter written to CMS, these modern day pioneers of accountability complain they are being treated unfairly, and if it doesn't stop they won't be pioneers anymore. As CMS prepares to start paying them according to their performance on identified measures, the letter asserts that some of the measures have "flat percentage benchmarks without anchoring methodology." Translation: CMS is imposing very high standards for quality -- not scaled according to current national hospital performance. Apparently, these "pioneers" expect to accomplish nothing different from what their non-pioneer colleagues in the rest of health care accomplish.
While these "pioneers" sit on the shore anchored to the performance expectations of the rest of the health care system, they also ask in their letter for a safe haven, not having their payment tied to performance for another year. They threatened to consider withdrawing from the program if their concerns are not addressed immediately.
To its credit, CMS did not agree to release them from the pinch of payment tied to their performance. The agency did cave on anchoring the benchmarks to current national performance. Today, several pioneers made good on their threat.
I don't recall anyone in the Ingalls family complaining that they couldn't set forth on their journey because they had no benchmarks from other people who'd done the same thing. Pa Ingalls didn't threaten to stop being a pioneer because he found out there were bears in the woods. Indeed, that was the point of being a pioneer: you were going to be first, and you accepted came with potential for great triumph and great loss. Being a pioneer takes courage, a willingness to take risks and an ambition to exceed the accomplishments of others.
If the Ingalls failed to do their jobs, the family faced hardship. But if the pioneering ACOs fail to do their jobs, it's the consumers and taxpayers who face hardship. The ACO movement incentivizes physicians and hospitals to join together, consolidating services in whole cities or regions, and more and more advocates have raised alarm about the prospects of market domination reducing quality and increasing costs.
A recent summit on the topic reinforced the point, suggesting that purchasers and plans must be more aggressive about imposing standards for quality -- or face dramatic erosion in standards even as prices escalate. Transparency tools like the Leapfrog Hospital Survey, the Hospital Safety Score and others will become more and more critical to keep pressure on, at least from the public.
So without true accountability, ambition and courage worthy of the word "pioneer," ACOs will only accelerate trends they were designed to reverse.
A version of this piece first appeared on Accountable Care News