After two and a half years of work to coordinate care for more than 28,000 Medicare beneficiaries, Sharp says it cannot make the financial model work.
Sharp HealthCare ACO is leaving the Pioneer Accountable Care Organization pilot program.
The decision, announced quietly in the company's third-quarter finance report, leaves San Diego with no Pioneer ACOs.
"Because the Pioneer model is based on national financial trend factors that are not adjusted for specific conditions that an ACO is facing in a particular region (e.g., San Diego), the model was financially detrimental to Sharp ACO despite favorable underlying utilization and quality performance," Sharp said its financial report, adding that the Center for Medicare & Medicaid Innovation was notified in June.
Date: September 16 1:00-2:30pm ET—presentations and live Q&A Expert speakers from Mayo Clinic and Vanderbilt University Medical Center reveal what key platforms are still making an impact, how to leverage social technologies to improve patient experience and drive engagement, and how to optimize your resources to ensure consistent brand messaging. >>>Register
Sharp ACO issued a statement this week explaining that it had worked with the Innovation Center for two and a half years to coordinate care for more than 28,000 Medicare beneficiaries but couldn't make the financial model work.
"Despite meaningful reductions in readmission rates and hospital and skilled nursing utilization, as well as improvements in the required quality indicators in 2012 and 2013 for these beneficiaries, CMMI reported break even financial performance for Sharp ACO in both of these years," Sharp ACO said in a media statement.
"The Pioneer financial model is based on national financial trend factors that are not adjusted for specific, often unrelated, rate implications that an ACO is facing in a particular region (e.g., San Diego), Alison Fleury, CEO at Sharp ACO, said in prepared remarks. "As a result, the financial impact can be detrimental to the ACO despite favorable underlying utilization and quality performance."
Fleury said CMMI agreed to address several problems with the financial model beginning in 2015. "Although we support the changes proposed by CMMI in the Pioneer financial model, it would not be prudent for us to place our ACO at financial risk in 2014 as we wait for these changes to be implemented," she said.
Sharp is the tenth Medicare Pioneer ACO to leave the program. Medicare beneficiaries served by Sharp ACO will transfer to traditional fee-for-service programs.
Pages
John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.