Banner Health Network (BHN) is among a handful of organizations in the country that have conclusively established through first-year success that accountable care organizations (ACO) can reduce Medicare costs. In the report released today by the Centers for Medicare and Medicaid Services (CMS), two Pioneer ACOs were identified as achieving 41 percent of the total overall reduction in 2012 spending growth in this nationwide demonstration project.

The research report entitled, The Effect of Pioneer ACOs on Medicare Spending in the First Year, was compiled for CMS by L&M Policy Research, an independent research firm in Washington DC.

BHN’s focus on providing highly collaborative care, especially for chronic, complex patients, was a key to early success. Surrounding at-risk patients with supportive care, in particular during care transitions, was an important strategy that helped to reduce hospital admissions and readmissions, for example. Advanced information technology was another important component of the ACO infrastructure, giving providers more information about the beneficiaries in their care.

“While the basis for this pilot model has merit, we also find that there is potential for changes that will result in far greater savings and better care in coming years,” says Chuck Lehn, Chief Executive Officer for Banner Health Network. “Most importantly we seek elements that would engage beneficiaries in the model as partners in maintaining wellness and managing their care.”

On average, the 32 Pioneers cited in this report produced savings of $20 per member /per month. Banner Health Network achieved an average savings of $50 per member/per month.

BHN is applying this same focus on chronic, complex patients to commercial plans. In addition to participating in the Medicare Pioneer ACO, BHN has developed accountable care relationships with Blue Cross Blue Shield of Arizona, Aetna, Health Net, United HealthCare and Cigna.