The Centers for Medicare and Medicaid Services debuted a slate of changes to ACO REACH on Monday that are designed to boost participation in the value-based care program.
The agency’s Center for Medicare and Medicaid Innovation elevated financial reserve requirements and reduced enrollment minimums under the Accountable Care Organization Realizing Equity, Accountability and Community Health, or ACO REACH, program, the office announced via its website.
ACO REACH enables providers to join together and manage costs for fee-for-service Medicare enrollees. CMS pays eligible ACOs a flat monthly fee, and providers can choose to share savings or losses with CMS or to fully assume the financial risks and benefits. ACO REACH launched this year as a successor to the Global and Professional Direct Contracting Model. CMS is due to release its findings this summer on whether the initiative has reduced spending.
To encourage provider participation, CMS eased enrollee minimums for new ACOs from 5,000 to 4,000 for 2024 and 2025.
The agency reduced the minimum for high-needs ACOs from 1,200 to 1,000 for 2025 and from 1,400 to 1,250 for 2026. ACOs are considered “high-needs” if they manage care for complex patients, such as those with multiple chronic conditions or those dually eligible for Medicare and Medicaid. CMS also expanded the enrollment criteria for these ACOs to include patients who received at least 90 days of home health services or spent 45 days in a skilled nursing facility over the past year.
Beginning in 2024, CMS will offer ACOs an enrollment buffer that allows them to remain in ACO REACH for a year even if their beneficiary counts fall below the minimum by up to 10%.
The agency increased the amount of capital that participating ACOs must reserve. The new policy raises the financial guarantee from 2.5% of healthcare costs for ACOs that share risk with CMS and 3% of those that bear the full risk to 4% for all ACO REACH participants. CMS also doubled the provisional settlement period to 12 months, which it said will help providers better plan their financial reserves.
The new policy establishes risk corridors that facilitate CMS recouping money from ACOs that miss spending targets. The agency will also apply the updated Medicare Advantage risk-score criteria to ACO REACH.
CMS updated the health equity benchmark adjustment to include data about Medicare enrollees who receive low-income subsidies, as well as those who reside in locations identified under the state-based area deprivation index, which the agency contends will add more underserved Medicare beneficiaries who live in high cost-of-living areas to ACOs. The agency will also offer up to $30 per beneficiary, per month to ACO REACH participants that serve the neediest enrollees.
The National Association of ACOs praised the modifications to ACO REACH. “We appreciate that CMS continues to improve on the ACO REACH model by addressing many concerns raised by NAACOS members,” President and CEO Clif Gaus said in a news release.
