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Mar 17, 2015 9:59:21 AM

CMS has announced their new ACO model, called the “Next Generation Accountable Care Organization,” a model that will allow providers to take on more financial risk, with potential reap greater financial rewards.

The goal will be to use this model to determine whether stronger financial incentive for ACOs can improve health outcomes and reduce expenses of Medicare patients.

While this ACO model will work similarly to Medicare Pioneer and Shared Savings ACO programs in that the providers who meet quality and spending measures will keep some of the program’s saving, this new model will use a new formula to calculate savings targets.  This new formula won’t exclusively rely on an ACO’s historical performance.

Additionally this new model is different in that it can offer financial incentives to keep patients in the provider network.

This creation of this ACO is significant, particularly in the transition to value-based care.

CMS expects this new model will attract between 15-20 ACOs across provider organization types and geographic regions within the first two years.  It is also expected that some Pioneer ACOs will migrate to this new program instead.

Definitive Healthcare’s Connected Care database currently tracks 821 accountable care organizations, 96 of which have an ACO start date of either Q1 2015.

The Next Generation ACO program will begin in January 2016.

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