CMS: ACO REACH Will Change in 2024

The U.S. Centers for Medicare & Medicaid Services (CMS) is making significant changes in 2024 to the Accountable Care Organization Realizing Equity, Access and Community Health (ACO REACH) payment model.

The updates include the introduction of a new approach to payment designed to enhance care delivery and care coordination for patients in underserved communities, according to CMS.

The agency will also require participating organizations to develop and implement a health equity plan to identify underserved communities in their markets, as well as create initiatives to reduce health disparities.


“In response to stakeholder feedback, [CMS] is announcing a coordinated set of changes to the [ACO REACH] Model starting in performance year 2024 that are expected to improve the model test by increasing predictability for model participants, protecting against inappropriate risk score growth and maintaining consistency across CMS programs and Center for Medicare and Medicaid Innovation models, and further advancing health equity,” the agency indicated on its website.

The forthcoming revised payment system is designed to increase the impact of the agency’s Health Equity Benchmark Adjustment, which rewards participants that are doing a good job of improving equal access and quality across patient populations.

In 2024, participants that achieve certain benchmarks will receive bonuses on a graduated scale based on their performance. Top performers will receive $30 per-beneficiary, per-month (PBPM). Participants at the next level of performance will get a $20 PBPM whereas others will receive $10 PBPM.


In addition to the health equity components, the program in 2024 will include policies intended to ensure that physicians and other providers continue to play a “primary role in accountable care,” CMS indicated.

Starting next year, at least 75% control of each ACO’s governing body must be held by participating providers or their designated representatives, compared to 25% during the first two Performance Years of the Global and Professional Direct Contracting (GPDC) models.

The program will also mandate that at least two beneficiary advocates sit on the governing board, both of whom must hold voting rights.

CMS also has plans to strengthen its vetting of prospective participants and to foster greater transparency.

“CMS will ask for additional information on applicants’ ownership, leadership, and governing board to gain better visibility into ownership interests and affiliations to ensure participants’ interests align with CMS’s vision,” the agency indicated. “We will employ increased up-front screening of applicants, robust monitoring of participants, and greater transparency into the model’s progress during implementation, even before final evaluation results, and will share more information on the participants and their work to improve care. Last, CMS will also explore stronger protections against inappropriate coding and risk score growth.”

The program launched on Jan. 1, replacing the GPDC models. CMS has said that ACO REACH reflects its redesigned strategy for payment system demonstrations, with advancing health equity as a key tenet.

Hospices that have joined ACOs are able to participate in ACO REACH directly. Providers can also develop preferred provider relationships with ACOs. The two parties can negotiate mutually beneficial terms that are customized to the needs and characteristics of their patient population. This practice began with the direct contracting models and will continue in the new program.

These contracts can involve shared-savings arrangements in which providers can receive a portion of the dollar amount of any health care cost reductions.

Within these contracts, the ACO takes on the role of the payer for the downstream provider, and they have options in how they approach reimbursement. Payments could be based on a full-capitation model with a per-patient, per-month rate, or they can be fee-for-service.

Other possibilities include hybrid models in which the hospice or other post-acute provider will receive a portion of their reimbursement on a fee-for-service basis, as well as additional payments later on determined by performance on quality metrics.

ACOs will be a cornerstone of CMS payment policy in the coming years. The agency seeks to align 100% of Medicare beneficiaries with an accountable care entity, Center for Medicare & Medicaid Innovation (CMMI) Director Elizabeth Fowler said at the National Association of ACOs (NAACOS) conference last year.

“Integration, team-based coordinated care through advanced primary care and ACOs is really the linchpin to driving better outcomes and bending the health care cost curve,” Fowler said. “As part of the strategy, we laid out five objectives. And we set a bold goal of having 100% of Medicare beneficiaries and the vast majority of Medicaid beneficiaries in accountable care relationships with providers who are responsible for cost of care and quality.”

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