We live in an evolving world fraught with economic instability, geopolitical shifting, pandemic malaise, and now the unsettled prospect of another World War. All at the same time, our country continues to deal with the looming insolvency of the Medicare program, with the potential for financial ruination should we not stay the course in moving towards a value-based payment system. While value-based care is clearly a bipartisan issue when it comes to the conceptual aspects of lowering total cost of care and improving patient outcomes, we have also seen just how politically charged payment model design structure really is when it comes to policy implementation. (Check out our recent podcast with Allison Brennan for more of an insider policy perspective on this recent debate.)

After months of political wrangling, the Center for Medicare and Medicaid Services (CMS) announced late last week that the Direct Contracting program will not continue in its current form. Instead CMS has redesigned the Direct Contracting Model to an ACO model focused on health equity. The ACO Realizing Equity, Access, and Community Health (REACH) Model will replace the Global and Professional Direct Contracting (GPDC) model at the end of the year.

According to CMS, the new ACO REACH Model will require all participating ACOs to have a robust plan describing how they will meet the needs of people with traditional Medicare in underserved communities and make measurable changes to address health disparities. The additional focus on health equity is to be commended; however, many industry leaders are disappointed that the GPDC model was scrapped without having the opportunity to prove that it can make a discernable impact on patient outcomes and total cost of care. For example, prior to the announced policy change, this week’s Race to Value podcast guest Dr. Clive Fields of VillageMD wrote an Op-Ed in Modern Healthcare demanding that policymakers “Give Medicare direct contracting time to prove its value or expose its flaws.

Many determinants played into the last week’s abrupt change of course. These include the concerns of progressive lawmakers that are leery of launching new value-based payment models that use similar levers as Medicare Advantage and the perceived influence of private equity that may expose untoward profit-driven motives within the GPDC model. While there was a lot of misinformation about the GPDC model during the recent political process, the ACLC applauds policymakers for creating the REACH model that will focus more intently on eliminating disparities of care in underserved communities.

In order to provide you with the information needed to make an informed decision about payment model selection, the ACLC will be releasing an Intelligence Brief on the ACO REACH model on March 14th. On that same day, we will also release a dedicated Race to Value podcast episode on ACO REACH with full analysis and perspective from Joe Satorius and Rick Goddard of Lumeris. In addition to these invaluable resources to guide your value journey, we also have upcoming Peer Learning Sessions to provide you with the leading contemporary knowledge on value-based care transformation.

The movement to value-based care is now more readily apparent than it has ever been! To learn about “the movement” and how you can best position your organization for success, please consider attending our upcoming 2022 Advancing Health Value Virtual Summit. During this important event, you will hear from ACLC co-founders Michael Leavitt and Dr. Mark McClellan as well as the one-and-only ZDoggMD. This is not to be missed!

Wishing you continued success in your value journey!

Executive Director, Institute for Advancing Health Value