On November 8, 2024, the Centers for Medicare & Medicaid Services released participant-level financial and quality results for the Accountable Care Organization Realizing Equity, Access and Community Health (ACO REACH) Model for Performance Year 2023 (PY 2023). 132 REACH ACOs participated in the model in PY 2023. The ACO REACH Model is a voluntary model that aims to improve quality of care and health outcomes for Medicare beneficiaries through the alignment of financial incentives, emphasis on patient choice, strong monitoring to ensure that beneficiaries maintain access to care, and an emphasis on care delivery. The full quality and financial results for PY 2023 are available on the ACO REACH webpage.
The financial and quality results are calculated differently than in the model’s formal evaluation. For this report, results are presented in comparison to financial benchmarks set for model participants. This approach to setting financial benchmarks aims to create transparent and understandable incentives for participating REACH ACOs to improve quality of care and reduce spending. In contrast, the evaluation considers the model’s spending and quality impact relative to a control group to evaluate performance compared to what would have occurred absent the model. ACO REACH redesigned and renamed the Global and Professional Direct Contracting (GPDC) Model effective January 1, 2023 to advance health equity to bring the benefits of accountable care to underserved communities, promote provider leadership and governance, and protect beneficiaries and the model with more participant vetting, monitoring, and transparency. The second annual evaluation for the GPDC Model, for PY 2022, is available on the GPDC Model webpage. The PY 2023 evaluation report is expected to be released in the summer of 2025 on the ACO REACH Model webpage.
PY 2023 Quality Results Highlights
Beginning in PY 2023, REACH ACOs shifted from pay-for-reporting measures to pay-for-performance measures. In PY 2023, the total quality score (TQS) for each ACO included more measurement components than prior years. REACH ACOs could earn additional points towards the TQS in PY 2023 for reporting beneficiary-reported demographic data and social determinants of health data and for demonstrating improvement in their quality scores from PY 2022 to PY 2023 or for scoring highly on all the model’s applicable claims-based measures.
Each model track is evaluated on three claims-based measures: Risk-Standardized All-Condition Readmission (ACR) within 30 days of discharge, All-Cause Unplanned Admissions for Patients with Multiple Chronic Conditions (UAMCC), Timely Follow-Up (TFU) after hospitalization for Standard and New Entrants ACOs, and Days at Home (DAH) for adults with complex, chronic disease for High Needs ACOs. ACOs that did not show improvement in their scores or continued strong performance could receive a downward adjustment to their TQS. The TQS is reported on a scale of 0 to 100%.
The average total quality score in PY 2023 was 78.55% across the 118 Standard and New Entrant ACOs, and 86.73% across the 14 High Needs Population ACOs. Performance on quality measures improved relative to PY 2022.
- In PY 2023, 32 out of 132 REACH ACOs earned a TQS of 100%. Of these, 25 were Standard/New Entrant ACOs, and seven were High Needs Population ACOs. For the High Needs Population ACOs, the seven ACOs with a TQS of 100% make up half of all High Needs ACOs in the model.
- 73 out of 83 REACH ACOs met the Continuous Improvement/Sustained Exceptional Improvement (CI/SEP) requirements. The CI/SEP is an indicator of improved performance on claims-based quality measures compared to the prior year (PY 2022). Only REACH ACOs that participated in both PY 2023 and PY 2022 can earn the CI/SEP.
- 24 of 83 ACOs met the CI/SEP requirements also met the High Performers Pool requirements and will receive an additional financial benefit for their quality measure performance. PY 2023 is the first year of the High Performers Pool, which is intended to further incentivize high performance and continuous improvement on the Quality Measure set. REACH ACOs qualify for a bonus from the High Performers Pool if they meet the CI/SEP criteria and also demonstrate a high level of performance or meet improvement criteria across all applicable claims-based measures.
- 20 of 77 Standard/New Entrant ACOs met the High Performers Pool criteria.
- Four of six High Needs Population ACOs met the High Performers Pool criteria.
- Only REACH ACOs that participated in both PY 2022 and PY 2023 can be in the High Performers Pool.
Comparing REACH ACO Quality Performance to PY 2022:
ACOs’ PY 2022 and PY 2023 TQS are not directly comparable because the shift to pay-for-performance measures through implementation of the Health Equity Data Reporting in PY 2023 may make it harder for REACH ACOs to earn a higher TQS. The average percentile rank is an indicator of how well an ACO performed on the three claims-based quality measures compared to the comparison provider groups included in the quality benchmarking population. REACH ACOs performed slightly better in PY 2023 than they did in PY 2022. This is based on the average REACH ACO ranking for each of the three claims-based measures (57.79 for PY 2023 and 54.73 for PY 2022).
- For Standard and New Entrant ACOs, average percentile ranks for Risk-Standardized All-Condition Readmission (ACR) within 30 days of discharge and All-Cause Unplanned Admissions for Patients with Multiple Chronic Conditions (UAMCC) improved slightly from PY 2022 to PY 2023 (not statistically significant). This indicates that Standard and New Entrant ACOs improved slightly better when compared to the non-REACH ACO population.
- For Standard and New Entrant ACOs, the average Timely Follow Up (TFU) performance improved from PY 2022 to PY 2023, with a statistically significant increase in average TFU measure score from 68.31% in PY 2022 to 71.80% in PY 2023.
- The TFU measure is the percentage of acute events related to one of six chronic conditions where follow-up care was received within the time frame recommended by clinical practice guidelines in a non- emergency outpatient setting.
- For High Needs Population ACOs, average Days at Home (DAH) scores improved by 5.46 percentage points in PY 2023 compared to PY 2022, from 310.80 days in PY 2022 among 6 ACOs to 316.26 days in PY 2023 among 14 ACOs.
o DAH measures the number of days that adults with complex, chronic disease spend at home or in community settings. PY 2023 was the first year of Pay-for-Performance for DAH.
REACH ACO’s performance on each individual quality measure is compared to a group of non-ACO REACH provider groups. All available Medicare fee-for-service data (including providers in the Shared Savings Program and others) are used to identify non-ACO REACH comparison provider groups. For High Needs Population ACOs, only those claims for beneficiaries who met the High Needs eligibility criteria are used for comparison.
PY 2023 Financial Results Highlights
In PY 2023, REACH ACOs generated approximately $1.643 billion in gross savings, representing approximately a 5.8% gross savings rate relative to the retrospective adjusted PY benchmarks. Net savings to CMS were $694.6 million (2.6%) , and the net savings to ACOs were $948.4 million (3.4%) compared to model benchmarks. This is an increase from the $371.5 million in net savings to CMS and the $484.1 million in net savings to ACOs in PY 2022.
- Among the 132 ACOs participating in the ACO REACH Model for PY 2023, 96 ACOs (73%) earned net savings from financial settlement, while 36 ACOs (27%) accrued net losses.
- 79% of ACOs in the Global risk option and 67% of ACOs in the Professional risk option earned shared savings.
- Savings increases from PY 2022 are due to performance improvements by model participants as they gained experience and growth in model participation.
- Between PY 2022 and PY 2023, per beneficiary per month gross savings increased by 72% to $71.15.
- 132 ACOs (from 99 ACOs in 2022) with 23 million beneficiary months (from 21 million in PY 2022)
- Improved performance by ACOs that started in PY 2021 drove the increase in net savings. The PY 2021 Cohort included 64% of total ACO savings despite PY 2022 being the largest model cohort.
o PY 2021 cohort ACO net savings for PY 2023 were $575.7 million (6.0% net savings rate)
o PY 2022 cohort ACO net savings for PY 2023 were $216.5 million (1.8% net savings rate)
o PY 2023 cohort ACO net savings for PY 2023 were $108.5 million (1.7% net savings rate) - 98% of PY 2023 CMS net savings were driven by the 3% discount applied to benchmarks of ACOs in the Global (100%) risk option – i.e., the majority of CMS’ savings were earned by capturing the first 3% of all savings generated by ACOs in the Global risk option. Additionally, net of High Performance Pool Payouts, the quality withhold lowered CMS payouts by $54.1 million.
- High Needs Population ACOs (13.3% net savings rate) and New Entrant ACOs (4.8%) achieved higher performance compared to Standard ACOs (2.8%), the result of more generous benchmarking policies as well as a smaller number of participants within the former two ACO types.
Given the financial and quality results are calculated differently from the evaluation results, the latter for PY 2023 will contain different savings estimates, and typically reflect more conservative financial results. PY 2022 evaluation savings were significantly lower than savings relative to the benchmark, with $632.2 million in evaluation losses compared to $855.6 million in savings relative to the benchmark.
The PY 2023 evaluation report is expected to be released in the summer of 2025 on the ACO REACH Model webpage. CMS is looks forward to learning about the care innovations employed by REACH ACOs to improve quality for their beneficiaries.