The 115 accountable care organizations that participated in ACO REACH in Performance Year 2024 generated $2.5 billion in gross savings, with $988.3 million returned directly to the Centers for Medicare and Medicaid Services (CMS), for the care of 2.5 million seniors, according to a new report. 

ACO REACH is an advanced ACO initiative to promote patient-centered care, lower costs, and align payment systems for Original Medicare beneficiaries through ACO risk-sharing and prospective payment. 

The ACOs participating in the model achieved a 6.7% net savings rate, while gross savings per beneficiary per month increased 24% between 2023 and 2024.

CMS noted that the financial and quality results are calculated differently than in the model’s formal evaluation. For this report, results are presented in comparison to prospective 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 comparison group to evaluate performance compared to what would have occurred absent the model.

For instance, the PY 2023 evaluation report noted that after factoring in shared savings and incentive payments, net spending increased across all ACO types relative to comparison groups. The evaluation report said that future results, reflecting model design changes to reduce incentive payments, may be more favorable. All ACO types reduced emergency department visits and observation stays, improved hospitalizations and/or post-acute care in PY 2023.

CMS also reported that the vast majority of participants maintained the delivery of high-quality care in PY 2024, achieving an average total quality score of 80.4% across the 101 Standard and New Entrant ACOs, and 86.2% across the 14 High Needs Population ACOs.

A statement from Mara McDermott, chief executive officer of Accountable for Health, an advocacy organization of more than 60 providers, payers, and innovators founded to champion accountable care, spoke to the more conservative financial performance estimates in the formal evaluations. She said it underscores the need to modernize how accountable care models are evaluated.

“The current evaluation methodology was developed when accountable care represented a relatively small share of traditional Medicare,” McDermott said. “Today, more than half of traditional Medicare beneficiaries receive care from providers participating in accountable care arrangements. Identifying an appropriate comparison group has become increasingly difficult, causing the evaluations to understate the impact of accountable care. Additionally, the evaluation reflects performance from 2023, and the model has evolved through multiple changes since then. Policymakers should place greater weight on the most current evidence available as they consider the future of accountable care. Measuring today's accountable care models using methodologies designed for a much smaller, earlier generation of value-based care risks overlooking the progress these models are making for patients and the Medicare program.”

The National Association of ACOs (NAACOS) said the Performance Year 2024 results demonstrate the success and impact of the model’s innovative design and focus on high-needs populations. NAACOS said it looks forward to seeing these features scale through the upcoming LEAD model.