CMS Redesigns Direct Contracting Into an Equity-Focused ACO Model

CMS said Thursday it is redesigning its accountable care organization (ACO) model away from its Global and Professional Direct Contracting (GPDC) model into one that focuses on health equity.

Slated to begin in 2023, the ACO Realizing Equity, Access, and Community Health (REACH) Model “addresses stakeholder feedback, participant experience, and Administration priorities, including CMS’ commitment to advancing health equity,” CMS said in a statement.

In addition, CMS is canceling the Geographic Direct Contracting Model, which was announced in December 2020 by the Trump administration but was paused in March 2021.

“The Biden-Harris Administration remains committed to promoting value-based care that improves the health care experience of people with Medicare, Medicaid and Marketplace coverage,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “To fulfill that commitment, CMS, through the Innovation Center, is testing new models of health care service delivery and payment to improve the quality of care that people receive, including those in underserved communities. The Innovation Center is making improvements to existing models and launching new models to increase participation in our portfolio, and CMS will be a strong collaborator to health care providers that participate in those models.”

GPDC will continue until December 31, 2022, and then will transition to the REACH model, but for the rest of the year, CMS said it will operate GPDC "with more robust and real-time monitoring of quality and costs."

The first performance year of REACH will start on January 1, 2023, and the model performance period will run through 2026.

Earlier this month, the National Association of ACOs (NAACOS) sent a letter to HHS asking that GPDC be overhauled instead of canceled. The letter, signed by more than 200 organizations, said that ending GPDC would stall the movement to value-based care.

In a statement released Thursday, NAACOS praised CMS and said REACH was basically a continuation of GPDC, "albeit with numerous changes and a new name."

"Many of the criticisms against Direct Contracting were a product of great misunderstanding about the model and the overall shift to value-based payment," NAACOS said. "Instead, keeping the model with additional focus on equity, increased provider governance, improvements to risk adjustment, and other changes is best moving forward." CMS adopted many of the changes the organization has been lobbying for, NAACOS said.