CMS announces yet another “ACO Product” designed to “transform the health industry” by changing how healthcare is paid to find an alternative to the traditional fee-for-service system.
Most of their previous experiments have been unsuccessful – only six out of more than 50 tested models generated savings for Medicare in 2021, according to CMS.
ACO REACH is an updated version of the discontinued Global and Professional Direct Contracting Model, with changes that include new risk adjustments that incentivize providers to take on high-needs patients and health equity requirement. It aims to increase quality and reduce unnecessary spending through better care coordination. The model was launched in January and will be tested through 2026.
ACOs participating in the ACO REACH model receive up-front payments, which are designed to give providers flexibility to manage care. ACO REACH focuses on primary care and on preventing adverse outcomes by improving care management and promoting preventive services. It will include services that fee-for-service Medicare traditionally does not cover, such as in-home visits, transportation assistance and nutritional counseling.
ACO REACH participants can choose between two forms of risk-sharing: Professional and global. The Professional Option offers capitated payments for primary care and sharing risk with CMS. Providers and the government split losses or savings 50%.
Under the Global Option ACOs take on full responsibility for costs and outcomes, meaning they keep any savings they generate or absorb any losses.
Source – Modern Healthcare Daily Dose, June 8, 2023