Accountable care organizations in the ACO Reach program can claim credit for saving the Centers for Medicare & Medicaid Services (CMS) hundreds of millions of dollars.
ACO Reach participants racked up CMS $1.64 billion in gross savings and $694.6 million in net savings, the feds announced Nov. 8. Net savings to ACOs are $984.4 million compared to benchmarks, and these savings can be reinvested by the ACOs to improve quality scores further.
The results show an improvement from performance year 2022. ACOs saved CMS just $371.5 million and ACOs $484.1 million that year. Per-beneficiary per-month gross savings increased by 72% to $71.15 in 2023, said CMS.
Nearly three-quarters of all ACOs in the program achieved positive savings. The promising results prompted the National Association of ACOs (NAACOS) to advocate the program’s extension.
“Despite the lack of opportunities for new ACOS to join, the ACO REACH Model has continued to grow in the number of participating clinicians, with more than 173,000 participating in 2024,” said Aisha Pittman, NAACOS' senior vice president of government affairs, in a statement.
The organization highlighted how ACO REACH helps providers give Medicare beneficiaries seldom-offered benefits like cost-sharing waivers and chronic disease management awards.
“Given the model’s proven success, we strongly encourage CMS to extend ACO REACH beyond its current expiration date of 2026, while continuing to refine and develop new total cost of care models that will drive long-term improvements in the quality and affordability of care,” Pittman continued.
These results are compared to financial benchmarks set for the 132 REACH ACOs participating in the model in 2023. They differ from the model's formal evaluation, which compares spending against performance if the model didn't exist.
Participants say this model of care is higher quality and the direction healthcare should be headed, with federal leaders claiming all Medicare enrollees should be in a value-based arrangement by 2030, versus the traditional fee-for-service model.
ACOs that were in the program since 2021 generated 64% of the total ACO savings last year at $575.7 million. ACOs that joined the model last year accounted for just $108.5 million in savings.
High-needs ACOs and new entrant ACOs performed significantly better than standard ACOs, largely due to benchmarking policies and because fewer high-needs and new entrant ACOs participate in the program. The average quality score, however, was higher among high-needs ACOs than their counterparts.