ACO REACH Results Offer Insights for High-Needs Providers Ahead of LEAD

CMS recently released the third annual independent evaluation of ACO REACH alongside preliminary 2024 results. As the model concludes in 2026 and is succeeded by the Long-term Enhanced ACO Design (LEAD) model, the findings offer important insights into the future of accountable care for medically complex beneficiaries.  

In Performance Year (PY) 2023, ACO REACH served more than 2.5 million beneficiaries through 115 ACOs. This includes 97 Standard ACOs, 4 New Entrant ACOs, and 14 High Needs ACOs. The model reduced gross Medicare spending by $706 million overall, with spending declining 2.0% for Standard ACOs, 6.2% for New Entrant ACOs, and 8.9% for High Needs ACOs.  

However, shared savings and other incentive payments often exceeded those reductions, resulting in cumulative net Medicare spending increases of 0.7% for Standard ACOs, 1.9% for New Entrant ACOs, and 11.4% for High Needs ACOs.  

High Needs ACOs served some of Medicare’s most complex beneficiaries. Patients averaged 12.2 chronic conditions, nearly double the burden seen in Standard and New Entrant ACOs. More than half (57%) were dually eligible for Medicare and Medicaid, 43% had long term care utilization, and annual mortality exceeded 20%. 

Despite this complexity, High Needs ACOs achieved strong utilization reductions, including: 

Nearly all interviewed High Needs ACOs used home-based medical care supported by advanced practice providers and multidisciplinary teams operating across home, post-acute and facility settings. They also relied more heavily on delivery flexibilities, including the Skilled Nursing Facility (SNF) 3-day rule and home health waivers. Across ACO REACH, the telehealth waiver and SNF 3-day rule waiver were the most frequently used benefit enhancements. 

The findings help explain several key features of LEAD, including revised benchmarking and concurrent risk adjustment for high-needs populations, lower beneficiary minimums for qualifying High Needs ACOs, home-based voluntary alignment, and additional financial supports for organizations caring for medically- complex beneficiaries.  

While LEAD incorporates several features aimed at addressing concerns raised under ACO REACH, it remains unclear whether they will fully resolve the core challenges identified in the model. 

Please contact AHCA’s Population Health Policy Analyst Rohini Achal or Nisha Hammel​, Vice President, Reimbursement Policy & Population Health with any questions.