CMS outlines policy shifts for ACO REACH model to align with MAHA
The Centers for Medicare & Medicaid Services (CMS) is proposing some changes to the Accountable Care Organization Realizing Equity, Access, and Community Health—ACO REACH—model, the government’s value-based Medicare initiative that supports providers that serve rural and low-income patient populations.
While the long-term fate of the reimbursement model remains unknown, supporters can find hope in knowing CMS still finds enough value in it to make some changes, all based on promising 2023 performance data. According to the agency’s report, ACOs that focus on high-need patient populations reduced spending by $2.3 million.
Standard ACOs saved $197.5 million on average in 2023—which CMS sees as a sign that value-based models are still working.
The ACO REACH program is set to expire in 2026; however, provider organizations have expressed interest in its continuation, given that it seems to be working. A performance report for 2024 won’t be available until later this year, but tweaks to the model for 2026 could very well mean a long-term extension is on the horizon—though CMS hasn’t made a statement one way or the other.
Based on available data, the new approach to ACO REACH will mean working toward preventing costly chronic illnesses, such as diabetes, by rewarding aligned providers for keeping patients healthy and setting goals related to personal wellness.
As for the specifics of what that entails, CMS has yet to say. However, the agency did confirm it will apply an additional 3% bump to risk score growth, as an incentive for ACOs to keep patients healthy—which aligns with President Donald Trump "Make America Healthy Again (MAHA)" agenda, which tends to prioritize diet and exercise over medicine.
New incentives and protections
Also starting in 2026, CMS will raise the Capitation Infrastructure Fund (CIF) limit from 1% to 2% for high-needs ACOs. Additionally, for new voluntarily aligned beneficiaries in these ACOs, CMS will cap risk score growth at 8% from 2023 to 2026, without requiring a minimum number of such beneficiaries.
The agency added that it plans to narrow risk corridors so it can start sharing in an ACO’s savings earlier. Instead of waiting for savings to exceed 25% above the benchmark, CMS will begin sharing once savings reach 10%.
That means agency will start taking a portion of the money saved by ACOs sooner than before—if a provider group saves money compared to its spending benchmark, the government will share in those savings once they hit 10%, instead of waiting for a bigger 25% savings.
Risk corridors act like safety nets in the ACO REACH Model, limiting how much money organizations can either gain or lose. In other words, they set boundaries on the amount of savings ACOs can share with CMS, as well as losses they may have to repay.
Ideally, this helps to balance financial risks for both the providers and Medicare through mutually shared savings.
The full list of policy changes can be found here.
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.