Medicare Direct Contracting is now ACO REACH: What you need to know

Despite pressure from some advocates to drop the Medicare Direct Contracting program, the Centers for Medicare and Medicaid Services’ (CMS) Centers for Medicare and Medicare Innovation (CMMI) has updated MDC into an accountable care organization program with an increased focus on health equity. It’s a win-win for providers looking to access value-based care and payments.

Now called ACO Realizing Equity, Access, and Community Health Model (ACO REACH), the CMMI program is accepting applications from March 7 to April 22 for new entities to launch for Performance Year 2023 and the optional Implementation Period (August 1, 2022 through December 31, 2023). Current MDC participants will be permitted to continue their participation in the ACO REACH program provided they maintain strong compliance and agree to the requirements of ACO REACH by January 1, 2023.

The announcement came on February 24 after lobbying by hundreds of provider organizations, health care associations and other proponents that wanted CMS to keep MDC. CMS had halted new MDC applications during 2021 for 2022.


What’s changed other than the name?

  • Governance is more focused on providers. A full 75% of the ACO board must be physicians versus 25% in the MDC model.
  • SDoH integration is built in. It’s included in the reporting requirements and in the addition of a health equity benchmark adjustment.
  • Risk adjustment mechanics are changing such that the 3% cap is reflective only of age/sex adjustment and no longer impacted by clinical documentation.
  • Additional Benefit Enhancement option is aimed at increasing access by expanding services that can be offered by nurse practitioners.
  • Quality Withhold is reduced from 5% to 2%.
  • Increased transparency of participant ACOs is required, including sharing beneficiary population size, quality and financial performance, which is similar to other ACO Models Public Use Files.


Why these changes?

  • It’s designed to deliver better alignment of the program with Medicaid managed care and comprehensive risk-bearing entities in all lines of business that are committed to community health equity.
  • CMS is following through on its recently updated 2030 vision to get more physicians and beneficiaries engaged in value-based payment arrangements with a deeper focus on health equity and SDoH.
  • Improves the position of physician-led and -governed risk-bearing entities.   


How we can help

COPE Health Solutions and our partners, Mindtree and Geniq, offer a comprehensive, flexible best-practice set of integrated managed service organization (MSO) co-source products. The MSO co-source enables COPE Health Solutions to collaborate closely with medical groups, FQHCs, IPAs, CINs and health systems to quickly create the necessary population health management infrastructure and network required for success as an ACO and overall in managed-care value-based payments (VBP) contracting.

The MSO co-source model includes:

  • COPE Health Solutions’ Analytics for Risk Contracting (ARC) cloud platform, incorporating and synthesizing data from a medical group, IPA/CIN/ACO or health system, including claims, EHR, pharmacy, lab, ADT, SDoH, biometrics and other relevant data as well as national Medicare fee-for-service data for enhanced benchmarking.
  • Geniq’s q platform integrated with ARC to provide care management, quality, clinical document and quality improvement and utilization management workflow tools.
  • Advanced API-based solutions that push the right analytics and risk stratification outputs, including prioritized gap closure actions, into the EHR and the physician workflow.
  • Clinical, operational, financial, actuarial and reinsurance expertise with best-practice, adaptable and configurable staffing models, workflows and related tool and templates.
  • Proven workforce development solutions including advanced practice practitioner fellowships and medical assistant training.


To help you with ACO REACH, please contact