ACO REACH and health equity: Seven FAQs you should know


Health equity. It’s about ensuring patients get the care they need when they need it. No exceptions.

Achieving equitable care for all is also the underlying theme of the latest Accountable Care Organization (ACO) model from the Centers for Medicare & Medicaid Services (CMS). The model, otherwise known as Realizing Equity, Access, and Community Health (REACH), empowers healthcare organizations to provide value-based equitable care, drive healthcare transformation, and inform the future of the Medicare Shared Savings Program.

Here are seven FAQs to help you understand the new Accountable Care Organization model that’s ushering in the next era of Medicare benefits payment and why this model is so important in the larger transition to value-based care.

Q: Why is the ACO REACH program needed?

A: The ACO REACH model not only improves health equity, it also strengthens traditional Medicare through controlled spending. The goal is to prevent the Part A trust fund from becoming insolvent, an outcome some experts predict could occur by 2026. The ACO REACH model helps save money while simultaneously providing high-quality care to Medicare beneficiaries—particularly those in underserved areas.

Q: How many Accountable Care Organizations currently participate in the ACO REACH program?

A: The program currently includes 132 ACOs. Among them are nearly 132,000 providers, 824 of which are Federally Qualified Health Centers, rural health clinics, and critical access hospitals.

Q: How does the ACO REACH program promote health equity?

A: REACH requires Accountable Care Organizations to identify health disparities through demographic and social determinants of health (SDOH) data and then take specific actions to address them. For example, Accountable Care Organizations must collect information about financial strain, employment, education, substance abuse, and mental health as well as race, ethnicity, language, sexual orientation, and gender identity. Then they must use that information to target underserved communities experiencing food and house insecurities, provider shortages, and other social needs.

Q: How does the ACO REACH Model account for the extra resources needed to treat socially and economically at-risk patients?

A: The model incorporates a health equity benchmark adjustment that includes higher financial spending targets for these patients.

Q: What types of entities can participate in the ACO REACH model?

A: These three types of provider-based Accountable Care Organizations (ACO) can participate:

  1. Standard ACOs are comprised of organizations with substantial experience serving Original Medicare beneficiaries. In 2023, 105 standard ACOs participate in ACO REACH.
  2. New entrant ACOs comprised organizations that have not traditionally provided services to Original Medicare beneficiaries. In 2023, 13 new entrant ACOs participate in ACO REACH.
  3. High-needs ACOs are comprised of organizations that service Original Medicare benefits patients with complex needs who are aligned to an ACO voluntarily or through claims-based alignment. In 2023, 14 high-needs ACOs participate in ACO REACH.

Q: What are the options for risk sharing under the ACO REACH model?

A: There are two voluntary risk-sharing options:

  1. Professional—50% savings/losses with one payment option for participants (i.e., a risk-adjusted monthly payment for primary care services)
  2. Global—100% savings/losses with two payment options (i.e., a risk-adjusted monthly payment for primary care services or a risk-adjusted monthly payment for all covered services, including primary and specialty care).

Additionally, each Accountable Care Organization may offer its own modified risk-sharing model to its aligned provider participants, including upside-only shared savings.

Q: What will ACOs in the REACH program need to be successful?

A: As with any Accountable Care Organization (ACO), the ingredients for success include patient engagement, physician buy-in, workflow efficiencies, and cost containment. Technology can also be a game changer—particularly when it helps providers identify care gaps and risk stratify patients. This combination of people, process, and technology are what will ultimately help ACOs in the ACO REACH program be successful.

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