Through a fourth year of top financial performance in the Pioneer ACO Model, while simultaneously improving its quality score year-over-year for four consecutive years, Banner Health Network demonstrated that it is possible to bend the Medicare cost curve while providing the best in quality care as part of this ACA demonstration program.

In 2011, Medicare introduced the Medicare Pioneer ACO Model with a goal of “testing the impact of different payment arrangements in helping organizations achieve the goals of providing better care to patients, and reducing Medicare costs.”

During Performance Year 4 (calendar year 2015) BHN achieved the 95th percentile in quality, and a financial savings of 5.5 percent. These results represent a top performance compared to Pioneer peer organizations, and BHN’s best performance in this program. At that rate of savings, and with 59,248 aligned beneficiaries, BHN generated more than $35.1 million in shared savings over the expected financial benchmark set by CMS’s Center for Innovation in Performance Year 4 (PY4).

“Delivering on lower costs in health care is a commitment Banner Health Network has made, and we are proud of our financial results in the Pioneer Model. Yet the story we really want people to hear is that we were able to provide a very high quality care for these Medicare beneficiaries in our network of care while reducing costs,” said Lisa Stevens Anderson, chief executive officer for BHN. “This success would not be possible without engaged care teams across the care continuum including a network of provider partners, Banner hospitals, nurse case managers, skilled nursing and home care providers and so many other affiliated health professionals that are outreaching to our Pioneer beneficiaries in support of their best health.”

In addition to participating in the Medicare Pioneer ACO Model, BHN has developed successful accountable care models in collaboration with commercial payers, such as: Aetna, Cigna, Blue Cross Blue Shield of Arizona and UnitedHealthcare, among others. Similar to the Pioneer ACO Model, improved care at lower costs have been important outcomes with these commercial payers.

BHN currently manages care for about 460,000 covered lives including those Medicare beneficiaries aligned with us as part of the Pioneer ACO Model.

“What is most exciting about our results is that we have demonstrated substantial savings while delivering dramatic quality improvement in a complex environment,” said Robert Groves, MD, chief medical officer for BHN. “These are solutions that work for real people and are scalable to the rest of the country.”

In Performance Year 3 (2014), BHN generated more than $29 million in savings over the predicted financial benchmark, while at the same time improving its quality score by 6.4 percent over the previous year. The savings generated in 2014 represented a 5 percent savings in the overall cost of care for the 57,722 traditional Medicare beneficiaries attributed to BHN that year.

In December 2011, BHN announced that it had been selected as one of only 32 organizations in the country to demonstrate the Pioneer ACO Model. That initial list of Pioneer peer organizations is down to 13 reporting organizations in PY4.

The central premise of the Pioneer ACO initiative is to create value through a highly coordinated, collaborative network of providers who are focused on achieving the highest level of wellness and prevention possible for their Medicare patients. As opposed to the traditional fee-for-service model, Pioneer provider networks benefit financially when they generate savings for Medicare in a value-based model. Revenues are generated through a percentage of Medicare savings. Savings are realized through tight coordination of care and adherence to evidence-based care. If expenses are greater than the expected benchmark, that Pioneer ACO is at risk for a percentage of losses as well.