Health Affairs: To Sustain The Value Movement, Make Next Generation ACOs A Permanent Option

The goal of the value movement is to incentivize providers to move away from the traditional fee-for-service model and provide coordinated care for patients with an eye toward improving quality and reducing cost. Accountable care organization (ACO) models are one key mechanism to achieve this goal. They offer varying levels of financial risk and reward allowing participants more flexibility in care delivery as they progressively assume more risk while successfully managing the quality of care for patients.

Medicare is leading the advancement of ACOs, currently operating several different ACO models including various Medicare Shared Saving Program (MSSP) tracks, the Next Generation (“Next Gen”) ACO model, and the Direct Contracting models. Now in its sixth year, the Next Gen ACO model provides an opportunity for providers to operate in full risk arrangements and offers operational and financial flexibilities that helps ACOs advance along the risk continuum.

Next Gen ACOs  have achieved gross savings for the Medicare Trust Fund, organized care in their local communities, and improved quality. Many of the model participants have invested resources over many years to be at the tip of the spear in Medicare risk models. We believe that to sustain the value movement and reward the achievements of early adopters, this administration should make the Next Generation ACO model a permanent option for providers. The Next Gen ACO model began in 2016 and is now scheduled to end on December 31, 2021, after receiving a one-year extension due to COVID-19. The Biden administration should revisit the decision made by the prior administration to end the Next Gen ACO model and closely consider its merits and worthiness as a permanent program option.


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