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Introducing the ACO REACH Model

Updated: Sep 26, 2023


On February 24, 2022, the Centers for Medicare and Medicaid Services (CMS) announced the termination of the existing Global and Professional Direct Contracting (GPDC) model effective December 31, 2022, as well as the somewhat unsurprising permanent cancellation of the Geographic Direct Contracting (Geo) model. GPDC will be replaced by a new enhanced model called Accountable Care Organization (ACO) Realizing Equity, Access, and Community Health (REACH) beginning January 1, 2023. According to CMS, the new REACH model “better reflects the agency’s vision of creating a health system that achieves equitable outcomes through high quality, affordable, person-centered care.”


Key Changes from GPDC to ACO REACH


The table below, summarizing information prepared by CMS, presents a brief overview of the primary changes between the GPDC and ACO REACH models.

GPDC

ACO REACH

Model Goals

  • Improve beneficiary access to providers who are personally engaged in their healthcare delivery.

  • Provide strong incentives to improve quality of care by shifting payment away from fee-for-service towards value-based capitated payments.

  • Allow organizations with prior ACO experience, innovative organizations taking risk in Medicare Advantage or Managed Medicaid, and organizations that focus on complex beneficiary populations to participate.

Improve the focus on:

  • Promoting health equity and addressing historical healthcare disparities for underserved communities.

  • Continuing the momentum of provider-led organizations participating in risk-based models.

  • Protecting beneficiaries and the model with more participant vetting, monitoring and greater transparency.

Governance

  • Participating providers generally must hold at least 25% of the governing board voting rights.

  • Each Direct Contracting Entity's governing board must include a beneficiary representative and a consumer advocate, though these representatives may be the same person and neither is required to hold voting rights.

  • Participating providers generally must hold at least 75% of the governing board voting rights.

  • Each REACH ACO’s governing board must include a beneficiary representative and a consumer advocate, who must each hold governing board voting rights and must be different people.

Health Equity

No policies explicitly promoting health equity.

  • Requirement for all REACH ACOs to develop a Health Equity Plan that must include identification of health disparities and specific actions intended to mitigate the health disparities identified.

  • Introduction of a health equity benchmark adjustment to better support care delivery and coordination for patients in underserved communities.

  • Requirement for all ACOs to collect beneficiary-reported demographic and social needs data.

  • New Benefit Enhancement to increase the range of services that may be ordered by Nurse Practitioners to improve access.

Benchmark Discounting for Global Participants

2023: 3.0%

2024: 4.0%

2025: 5.0%

2026: 5.0%

2023: 3.0%

2024: 3.0%

2025: 3.5%

2026: 3.5%

Quality Withhold

5%

2%


Promoting Health Equity


As highlighted above, the REACH model incorporates a number of new requirements aimed at promoting health equity and advancing the benefits of accountable care to underserved communities. Those requirements include:

Health Equity Plans

REACH ACOs must develop a Health Equity Plan (HEP) that identifies health disparities and priority populations amongst their beneficiaries. The HEP will be used to define strategies that are expected to reduce these identified health disparities. CMS plans to offer an HEP template based on the CMS Disparities Impact Statement used by the CMS Office of Minority Health. Refer to the image below for the framework used by the CMS Disparities Impact Statement:



Benchmark Adjustments

CMS will adjust the expenditure benchmark of ACOs that serve a higher proportion of underserved beneficiaries. CMS has indicated that the adjustments will be based on a “composite measure that incorporates a combination of the Area Deprivation Index and Dual Medicaid Status...” This new adjustment adds a layer of complexity beyond the single characteristic (dual eligibility) adjustment paradigm used in the Hospital Readmission Reduction Program. As such, the ACO REACH benchmark adjustment will represent CMS’s most comprehensive consideration to date to account for social determinants of health (SDOH). For 2023, CMS plans to increase the monthly capitation payment for the beneficiaries demonstrating the highest 10 percent of social need by $30. Conversely, CMS plans to decrease the monthly capitation payment for the beneficiaries demonstrating the lowest 50 percent of social need by $6.

Collection of New Data

Participants in the ACO REACH model will collect new information from beneficiaries aimed at monitoring and improving health equity. Specifically, ACOs participating in the REACH model will be required to request certain demographic and social needs data from their enrolled beneficiaries. In PY2023, CMS proposes to reward ACOs for successful reporting of required beneficiary-reported demographic data with a bonus addition to the ACO’s Total Quality Score of up to 10 percentage points, but not to exceed 100 percent. CMS currently plans no downward adjustment for non-submission of this information.

Improved Access

ACO REACH participants will be able to utilize nurse practitioners (NPs) that are Participating Providers or Preferred Providers to order an expanded list of services in order to improve access for the ACO’s beneficiaries. Specifically, NPs in a REACH model ACO may certify a beneficiary’s need for hospice care; certify a beneficiary’s need for diabetic shoes; establish, review, and sign a written care plan for a beneficiary’s cardiac rehabilitation; establish, review, sign, and date a beneficiary’s home infusion therapy plan of care; and make referrals for medical nutrition therapy.


REACH Model Participation Options


The ACO REACH model will offer the same three participant options as offered under GPDC: Standard, New Entrant, and High Needs Population. The risk sharing options will also mirror those of GPDC. Specifically, ACOs can opt for the lower-risk professional model (50% savings/losses) with primary care capitation or the higher-risk global model (100% savings/losses) with either primary care capitation or total care capitation. Current GPDC participants may either continue participating in the ACO REACH model if they meet the applicable requirements or choose to end participation.


CMS has indicated that it intends for ACO Reach model participants, including providers, to receive the same scope of protection currently available for GPDC participants under the CMS-sponsored model safe harbor of the anti-kickback statute.



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