Pioneer ACO Model Fact Sheet

Pioneer ACO Model Fact Sheet

The Pioneer ACO Model is a CMS Innovation Center initiative designed to support organizations with experience operating as Accountable Care Organizations (ACOs) or in similar arrangements in providing more coordinated care to beneficiaries at a lower cost to Medicare. The Pioneer ACO Model will test the impact of different payment arrangements in helping these organizations achieve the goals of providing better care to patients, and reducing Medicare costs.

Accountable Care Organizations

Accountable Care Organizations (ACOs) are one way CMS is working to ensure better health care, better health, and lower growth in expenditures through continuous improvement.

The Medicare Shared Savings Program provides incentives for ACOs that meet standards for quality performance and reduce cost while putting patients first. Established by the Affordable Care Act, CMS published final rules for the Shared Savings Program on November 2, 2011. More information is available at

Working in concert with the Shared Savings Program, the Innovation Center is testing an alternative ACO model, the Pioneer ACO Model. More information on all of these initiatives is available on the Innovation Models web page.

The Innovation Center

The Innovation Center was created by the Affordable Care Act to test new models of health care delivery and payment. The Center also offers technical support to providers to improve the coordination of care and share lessons learned and best practices throughout the health care system. It is committed to refining the Medicare, Medicaid and CHIP programs to deliver better care for individuals, better health for populations, and lower growth in expenditures.

The Pioneer ACO Model Model and Selected Organizations

The Pioneer ACO Model was designed specifically for organizations with experience offering coordinated, patient-centered care, and operating in ACO-like arrangements. The selected organizations were chosen for their significant experience offering this type of quality care to their patients, along with other criteria listed in the Request for Applications (RFA) document available at These organizations were selected through an open and competitive process from a large applicant pool that included many qualified organizations.

The 19 organizations participating in the Pioneer ACO Model in PY4 (CY2015):


Service Area

1. Allina Health Minnesota and Western Wisconsin
2. Atrius Health Eastern and Central Massachusetts
3. Banner Health Network Phoenix, Arizona Metropolitan Area
(Maricopa and Pinal Counties)
4. Beacon Health (Eastern Maine Healthcare System) Central, Eastern, and Northern Maine
5. Bellin-Thedacare Healthcare Partners Northeast Wisconsin
6. Beth Israel Deaconess Physician Organization Eastern Massachusetts
7. Brown & Toland Physicians San Francisco Bay Area, CA
8. Dartmouth-Hitchcock New Hampshire and Eastern Vermont
9. Fairview Health Systems Minneapolis, MN Metropolitan Area
10. Heritage California ACO Southern, Central, and Costal California
11. Michigan Pioneer ACO Southeastern Michigan
12. Monarch Healthcare Orange County, CA
13. Montefiore ACO New York City (the Bronx) and lower Westchester County, NY
14. Mount Auburn Cambridge Independent Practice Association (MACIPA) Eastern Massachusetts
15. OSF Healthcare System Central Illinois
16. Park Nicollet Health Services Minneapolis, MN Metropolitan Area
17. Partners HealthCare Eastern Massachusetts
18. Steward Health Care System Eastern Massachusetts
19. Trinity Pioneer ACO (UnityPoint Health) Northwest Central Iowa


Payment Arrangement and Beneficiary Alignment

The first performance period began in January 1st, 2012. In the first two performance years, the Pioneer Model tested a shared savings and shared losses payment arrangement with higher levels of reward and risk than in the Shared Savings Program. These shared savings were determined through comparisons against an ACO’s benchmark, which is based on previous CMS expenditures for the group of patients aligned to the Pioneer ACO as well as the trend in expenditures for the national Medicare population.

In year three of the program, those Pioneer ACOs that elected to and showed savings over the first two years were eligible to move to a population-based payment model. Population-based payment is a per-beneficiary per month payment amount intended to replace some or all of the ACO’s fee-for-service (FFS) payments with a prospective monthly payment.

Under the Pioneer ACO Model, CMS prospectively aligns beneficiaries to ACOs, allowing care providers to know at the beginning of a performance period for which patients’ cost and quality they will be held accountable.

Beneficiary Protections and Quality Measures

Providing the beneficiary with a better care experience is one of the central focuses of the Pioneer ACO Model. Under the Pioneer ACO Model, beneficiaries will maintain the full benefits available under traditional Medicare (fee-for-service), as well as the right to receive services from any healthcare provider accepting Medicare patients.

To ensure beneficiaries receive high quality care and enjoy a positive experience, CMS has established robust quality measures that will be used to monitor the quality of care provided and beneficiary satisfaction. These measures mirror those in the Shared Savings Program. For more information, visit the CMS Shared Savings Program page and view the fact sheet entitled “Improving Quality of Care for Medicare Patients: Accountable Care Organizations.”

Program Requirements

To be eligible to participate in the Pioneer ACO Model, organizations are required to be providers or suppliers of services structured as:

  1. ACO professionals in group practice arrangements;
  2. Networks of individual practices of ACO professionals;
  3. Partnerships or joint venture arrangements between hospitals and ACO professionals;
  4. Hospitals employing ACO professionals; or
  5. Federally Qualified Health Centers (FQHC).

Health Information Technology

At least 50% of the Pioneer ACO’s primary care providers have met requirements for meaningful use of certified electronic health records (EHR) for receipt of payments through the Medicare and Medicaid EHR Incentive Programs.

Minimum Number of Aligned Beneficiaries

Beneficiaries are aligned to ACOs through the healthcare providers that choose to participate. CMS reviews where a beneficiary has been receiving the plurality of their primary care services, and uses that information to establish which beneficiaries are aligned to a participating provider annually. If a primary care provider chooses to participate in an ACO, the beneficiaries aligned to that provider are aligned to the ACO. If a beneficiary receives less than 10 percent of their care from a primary care provider, CMS will review where a beneficiary has been receiving the majority of his/her specialty services to determine alignment.

Generally, ACO participants must have a minimum of 15,000 aligned beneficiaries; unless located in a rural area, in which case they are to have a minimum of 5,000 beneficiaries. In order to be aligned, beneficiaries must be enrolled in original, fee for service Part A and B Medicare. They cannot be participating in Medicare Advantage plans.

Participation of Other Payers

The Innovation Center believes that Pioneer ACOs will be more effective in producing improvements in better care for individuals, better health for populations, and slower growth in expenditures if they fully commit to a business model based on financial and performance accountability. The Innovation Center therefore encourages Pioneer ACOs to enter into similar contracts with other payers (such as insurers, employer health plans, and Medicaid).

Pioneer ACO Model and the Shared Savings Program

The Pioneer ACO Model is distinct from the Shared Savings Program. The Shared Savings Program fulfills a statutory obligation set forth by the Affordable Care Act to establish a permanent program that develops a pathway forward for groups of health care providers to become ACOs, while the Pioneer ACO Model is an initiative designed to test the effectiveness of a particular model of payment. Final rules for the Shared Savings Program were published in November 2011. More information is available at CMS Shared Savings Program page.

The Pioneer ACO Model differs from the Medicare Shared Savings Program in the following ways, among others:

  • The first two years of the Pioneer ACO Model are a shared savings payment arrangement with higher levels of savings and risk than in the Shared Savings Program.
  • Starting in year three of the initiative, those organizations that have earned savings over the first two years will be eligible to move to a population-based payment arrangement and full risk arrangements that can continue through optional years four and five.
  • There are “benefit enhancement” tools available to ACOs to help improve their engagement with beneficiaries, including: (1) greater access to skilled nursing facility services; and (2) a process that allows beneficiaries to confirm their care relationship with ACO providers.

Beneficiary Enhancements

Three-Day Skilled Nursing Facility Rule Wavier

CMS makes available to qualified Pioneer ACOs a waiver of a three-day inpatient stay requirement prior to admission to a skilled nursing facility (SNF) or acute-care hospital or CAH with swing-bed approval for SNF services (“swing bed hospital”). This benefit enhancement will allow beneficiaries to be admitted to qualified Pioneer SNF affiliates either directly or with an inpatient stay of fewer than three days. The waiver will apply only to eligible aligned beneficiaries admitted to Pioneer SNF affiliates by the Pioneer ACO providers.

An aligned beneficiary will be eligible for admission in accordance with this waiver if: (1) the beneficiary does not reside in a nursing home or SNF for long-term custodial care at the time of the decision to admit to a SNF; and (2) the beneficiary meets all other CMS criteria for SNF admission, including that the beneficiary must:

  • be medically stable;
  • have confirmed diagnoses (e.g., does not have conditions that require further testing for proper diagnosis);
  • not require inpatient hospital evaluation or treatment; and
  • have an identified skilled nursing or rehabilitation need that cannot be provided on an outpatient basis or through home health services.

Pioneer ACOs will be asked to describe how SNF affiliates have the appropriate staff capacity and necessary infrastructure to carry out proposed coordination activities. In addition to the information the ACO includes in its implementation plan, SNF affiliates must also have, at the time of application submission, a quality rating of 3 or more stars under the CMS 5-Star Quality Rating System as reported on the Nursing Home Compare website. This star standard is subject to change in response to changes in the scoring methodology that will take effect in 2015.  

Voluntary Alignment

Pioneer ACOs may offer beneficiaries the option to confirm or deny their care relationship with their Pioneer ACO providers. Beneficiary confirmations will be reflected in ACO alignment in the subsequent performance year. Confirmations of care relationships through voluntary alignment supplement claims-based attributions. For example, a beneficiary who indicates that a Pioneer ACO provider is her main source of care may be aligned with the ACO, even if claims-based alignment would not result in alignment.

Additional Information

Additional information about the Pioneer ACO Model is available on the Pioneer ACO Model web page.

Page Last Modified:
09/06/2023 05:13 PM