What is ACO REACH? Definition, Formula, and Benchmark

ACO REACH (Accountable Care Organization Realizing Equity, Access, and Community Health) is a CMS Innovation Center model launched in performance year 2023 as a redesigned, re-branded successor to the Global and Professional Direct Contracting (GPDC) model. CMS restructured GPDC following stakeholder concerns about private-equity participation, beneficiary protections, and health equity, and re-issued the model with stricter governance requirements and an explicit equity focus.

ACO REACH operates in two risk tiers. The Global Option requires ACOs to accept 100% shared savings and 100% shared losses on attributed beneficiaries' total Medicare Part A and Part B expenditures, with either a full-capitation or primary-care-capitation payment mechanism. The Professional Option accepts 50% shared savings and 50% shared losses, with primary-care capitation only. In both options, CMS attributes beneficiaries via claims-based algorithm supplemented by voluntary alignment.

Distinguishing features separate ACO REACH from MSSP. First, the Health Equity Benchmark Adjustment (HEBA) adds or subtracts up to ±30 basis points from the benchmark based on the ACO's attributed population mix of underserved beneficiaries (measured by dual-eligibility, low-income subsidy, and neighborhood deprivation indices). Second, ACO REACH requires a Health Equity Plan detailing targeted interventions for underserved populations. Third, the benchmark methodology emphasizes a forward-looking trend more heavily than MSSP and caps annual risk-score growth at 3%. Fourth, ACO REACH permits broader use of non-fee-for-service payment mechanisms including capitated payments directly to primary care, specialty, and post-acute providers.

Participation is structured around Provider Participants (those receiving capitated payment and signing contracts with the ACO) and Preferred Providers (non-participant clinicians the ACO coordinates with informally). ACO governance must be majority controlled by providers or beneficiary representatives, with required beneficiary advisor roles and health equity officer designation.

Operationally, ACO REACH demands substantially more infrastructure than MSSP. Capitated payment to participating providers requires claim-level reconciliation, timely NCR (non-claims-based revenue) tracking, and care-coordination platforms that function across the continuum rather than concentrated in primary care. Risk-adjustment accuracy is more consequential given the 3% annual cap: a single year of under-coding can permanently lower the ACO's forward benchmark. Data integration across participating provider EHRs, post-acute facilities, and payer claims feeds becomes mission-critical.

ACO REACH is scheduled to sunset at the end of performance year 2026. CMS has not yet released final successor model specifications but the broad direction of Innovation Center signaling points toward accelerated high-risk arrangements with stronger equity integration. Organizations in ACO REACH in 2024–2026 are simultaneously operating the model and preparing their infrastructure for whatever successor emerges.