On February 24, 2022, CMS announced major changes to several of its innovation models, including the permanent cancellation of the Geographic Direct Contracting Model—a Trump-era model that tested whether a geographic-based approach to care delivery and value-based care can improve health and reduce costs for Medicare beneficiaries across an entire geographic region. On the same day, CMS also announced the launch of the Accountable Care Organization Realizing Equity, Access, and Community Health (ACO REACH) Model, a rebranded and redesigned version of the Global and Professional Direct Contracting Model (GPDC) Model.
CANCELLATION OF THE GEOGRAPHIC DIRECT CONTRACTING MODEL
On December 3, 2020, CMS announced a new payment and care delivery model testing whether a geographic-based approach to care delivery and value-based care can improve health and reduce costs for Medicare beneficiaries across an entire geographic region. The Geographic Direct Contracting Model was designed to allow ACOs to assume financial risk in return for enhanced flexibilities, purportedly making it possible for these entities to offer Medicare beneficiaries an increased focus on care coordination through care-delivery innovation.
The model was initially scheduled to begin on January 1, 2022 but came under review by the Biden administration and was put on hold until further notice. CMS’s announcement last week permanently cancelling the Geographic Direct Contracting Model stated that the model “does not align with CMS’s vision of accountable care and concerns raised by stakeholders.”
GLOBAL AND PROFESSIONAL DIRECT CONTRACTING MODEL BECOMES ACO REACH
The GPDC Model was implemented on October 1, 2020 as a voluntary, ACO model to incentivize participation in value-based care arrangements under original Medicare. The model offers two risk-sharing arrangement options. Under the “Professional” option, participants face a 50% savings/losses arrangement with one payment option for participants, which is a risk-adjusted monthly payment for primary care services provided by the ACO’s participating providers (Primary Care Capitation Payment). Under the “Global” option, participants face a 100% savings/losses arrangement—with either the Primary Care Capitation Payment or a risk-adjusted monthly payment for all covered services, including specialty care, provided by the ACO’s participating providers (Total Care Capitation Payment). In each option, participating providers accept Medicare claims reductions and agree to receive at least some compensation from their ACO.
Beginning in 2023, the GPDC Model will be redesigned and renamed the ACO REACH Model. Despite a new moniker and redesign, the risk sharing options have not changed. According to a press release from CMS, the ACO REACH Model “better reflect[s] the priorities of the Biden-Harris Administration.” Among other changes, the ACO REACH Model requires all participants to have a robust health equity plan describing how they will reach underserved populations. The new model also provides an adjustment to increase the benchmark for ACOs serving higher proportions of underserved beneficiaries, which will be identified using a composite measure that incorporates a combination of the Area Deprivation Index and Dual Medicaid Status to ensure the benefits of ACOs are available to all Medicare beneficiaries.
The ACO REACH application period for Performance Year 2023 and the optional Implementation Period (running August 1, 2022 through December 31, 2023) is March 7, 2022 to April 22, 2022. According to CMS, organizations currently participating in the GPDC Model will be permitted to continue participating in the ACO REACH Model, provided they maintain a strong compliance record and agree to meet the requirements of the ACO REACH Model by January 1, 2023.
CMS’s summary of the ACO REACH Model is available here.
