GDPC Model PY2022 Results; ACO Reach PY2023 Predictions

ACO-Reach-PY2023-Predictions-blog (1)

In October 2023, the Centers for Medicare and Medicaid Services (CMS) released the performance results of the Global and Professional Direct Contracting (GDPC) Model for performance year (PY) 2022. The Global Model has been redesigned and renamed The ACO Realizing Equity, Access and Community Health (ACO REACH) Model for PY2023 onward. The redesign aligns with the goals to advance health equity and “to improve the quality of care for people with Medicare through better care coordination, reaching and connecting health care providers and beneficiaries, including those beneficiaries who are underserved.

GPDC Model was a voluntary Accountable Care Organization (ACO) model that built upon lessons-learned from initiatives such as the Medicare Shared Savings Program and the Next Generation ACO Model. The GPDC model focuses on the Medicare beneficiary’s specific health care needs and significantly changed financial incentives to reward high quality care, with a risk-based contract. To read more about the model, click here: Global and Professional Direct Contracting (GPDC) Model | CMS.

2022 was the second performance year for the GDPC model. In PY2022:

  • 99 DCEs participated
    • 75 DCEs (76 percent) earned shared savings
      • 79 percent of DCEs in the Global risk option earned shared savings
      • 67 percent of DCEs in the Professional risk option earned shared savings
    • 23 DCEs (23 percent) incurred losses

Between PY2021 and PY2022, gross savings increased seven-fold, largely due to the growth in the number of participants. DCEs that started their performance in 2021 also significantly contributed to the increased performance in 2022.

For 2023 the ACO REACH Model has 132 ACOs with 131,772 health care providers and organizations providing care to an estimated 2.1 million beneficiaries.

Here are our predictions for PY2023 results:

While there is a significant increase in the number of participants from PY2022 to PY2023, many are new entrants. Organizations entering risk contracts are encouraged to have experience with these models, since organizations that have experience year over year typically perform better once, they’ve had experience. Gross savings will likely be the highest in PY2023 than ever before, however, many organizations will also incur losses since they are new to the program. Organizations that do not achieve their intended result will likely drop out of the program. In fact, Clover Health is leaving the ACO REACH program at the end of the 2023 performance year, citing lack of profitability. Other organizations are likely to follow.

No matter how many organizations participate specifically in the ACO Reach model, value-based care contracting will continue to be at the forefront of health policy due to the lack of sustainability of the current healthcare expenditures.