Georgia Medicare Shared Savings Program ACO 2026 Guide

title: Georgia Medicare Shared Savings Program (MSSP) and ACOs Guide subtitle: A plain-language guide for Georgia Medicare beneficiaries, families, and providers. Learn how Accountable Care Organizations (ACOs) work under the Medicare Shared Savings Program, how the ACO REACH Model fits in, how patients are assigned to an ACO, and which major Georgia health systems and physician-led groups participate.

By Brevy Care Team · Last verified May 13, 2026

For every Georgia Medicare fee-for-service beneficiary attributed to an Accountable Care Organization (ACO), every primary care physician participating in MSSP or ACO REACH, every Georgia hospital sponsoring an ACO or partnering with physician-led ACOs, every care manager coordinating discharges and follow-up visits for ACO-assigned populations, and every health policy stakeholder analyzing the trajectory of value-based Medicare payment, the Medicare Shared Savings Program is among the most consequential developments in Medicare since the program's creation in 1965. Established by Section 3022 of the Affordable Care Act of 2010 and codified at Section 1899 of the Social Security Act, MSSP enables groups of healthcare providers to come together as ACOs, take collective accountability for Medicare beneficiaries' care quality and costs, and share in any savings achieved.

This guide explains the federal authorities (Section 3022 of the ACA, Section 1899 of the Social Security Act, the 42 CFR Part 425 implementing regulations, the Pathways to Success Final Rule, the ACO REACH Model authority, the CMS Innovation Center's Section 1115A authority), the ACO definition and eligible participant types, the beneficiary assignment methodology, the BASIC Track Levels A through E and the ENHANCED Track structure under the 2018 Pathways to Success Rule, the shared savings and loss calculation methodology, the ACO REACH Model (Standard, New Entrant, and High Needs Population categories), the legacy ACO models (Pioneer ACO, Next Generation ACO, Direct Contracting), the ACO-specific authorities and waivers (SNF 3-day stay waiver, telehealth expansion, beneficiary engagement incentive programs), the AKS and Stark waivers for ACO arrangements, the quality measurement transition to APP for CY 2025+, the CMS Innovation Center's 10-Year Strategy, the Georgia ACO landscape (major health system and physician-led ACOs), and how Georgia Medicare beneficiaries benefit from coordinated care.

The Federal Statutory Framework

Section 3022 of the Affordable Care Act of 2010

The Medicare Shared Savings Program was established by Section 3022 of the Patient Protection and Affordable Care Act of 2010 (Public Law 111-148). Section 3022 of the ACA added a new Section 1899 to the Social Security Act establishing the statutory framework for MSSP.

The legislative history of Section 3022 reflects extensive policy development through the 2000s. Researchers and policymakers, including Elliott Fisher and colleagues at Dartmouth (who developed the conceptual framework for ACOs in articles published 2006-2007), MedPAC, and various academic and policy organizations, advocated for shared accountability structures that could better align provider incentives with patient outcomes. The ACA codified these concepts into MSSP.

Section 1899 of the Social Security Act

Section 1899 of the Social Security Act establishes the statutory framework for MSSP. Key provisions include:

Section 1899(a): Authority and purpose of MSSP.

Section 1899(b): ACO definition, eligibility, and requirements.

Section 1899(c): Quality and other reporting requirements.

Section 1899(d): Payment to ACOs (shared savings).

Section 1899(e): Patient-centered criteria.

Section 1899(f): Recipients of payment.

Section 1899(g): Quality measures.

Section 1899(h): Definitions.

Section 1899(i): Waivers (SNF 3-day rule, telehealth, beneficiary incentives, and others as the Secretary determines).

Section 1899(j): Avoidance of duplicative payments.

Section 1899(k): Limitations on review.

Section 1899(l): Coordination with other programs.

42 CFR Part 425: The Implementing Regulations

CMS implements MSSP through detailed regulations at 42 CFR Part 425, including:

• 42 CFR 425.20-425.40: ACO Eligibility
• 42 CFR 425.100-425.118: ACO Application and Participation
• 42 CFR 425.200-425.224: Beneficiary Notifications and Marketing
• 42 CFR 425.300-425.318: Compliance
• 42 CFR 425.400-425.404: Beneficiary Assignment
• 42 CFR 425.500-425.514: Quality
• 42 CFR 425.600-425.612: Shared Savings and Losses
• 42 CFR 425.700-425.722: Program Integrity
• 42 CFR 425.800-425.812: Reconsideration and Reopening

The CMS Pathways to Success Final Rule (CMS-1701-F)

CMS published the Pathways to Success Final Rule, with most provisions effective in 2019. The rule substantially restructured MSSP, motivated by several CMS findings:

• The original Track 1 (one-sided shared savings only) had grown to dominate MSSP participation, with limited movement to two-sided risk.
• Most one-sided ACOs were not generating net savings to Medicare when accounting for shared savings payments.
• Two-sided risk ACOs (Tracks 2 and 3) consistently generated more savings.
• The original tracks structure did not provide a clear glide path from one-sided to two-sided arrangements.

The Pathways to Success rule replaced the three original tracks with:

• BASIC Track: A five-level glide path (Levels A through E) with progressively increasing risk.
• ENHANCED Track: Maximum risk and reward, replacing the prior Track 3.

The rule also accelerated transitions, requiring most new ACOs to move from one-sided to two-sided risk within 5 years.

ACO Definition and Eligibility

Section 1899(b)(1) Eligible Participant Types

ACO participants eligible to form an MSSP ACO include:

(A) ACO Professionals in Group Practice Arrangements: A group practice of ACO professionals (defined as physicians, including doctors of medicine, osteopathy, dentistry, podiatry, optometry, and chiropractic practitioners).

(B) Networks of Individual Practices: Networks of individual practices of ACO professionals.

(C) Hospital-Physician Partnerships: Partnerships or joint venture arrangements between hospitals and ACO professionals.

(D) Hospitals Employing ACO Professionals: Hospitals employing physicians.

(E) Such Other Groups as the Secretary Determines: CMS has used this authority to add CAHs (under Method II), RHCs, FQHCs, and other Medicare-enrolled providers.

Minimum Beneficiary Threshold

Section 1899 of the Social Security Act and the MSSP regulations at 42 CFR Part 425 require that an ACO meet a minimum-population threshold of assigned Medicare fee-for-service beneficiaries. This threshold ensures sufficient population for meaningful performance measurement; verify the current beneficiary minimum in the CMS Medicare Shared Savings Program regulations.

Three-Year Initial Agreement

ACOs enter into 3-year participation agreements with CMS (typically renewable). The 3-year period provides stability for ACO operations and meaningful performance measurement, while allowing CMS to terminate poorly performing ACOs.

Compliance Plan Requirement

ACOs must establish and maintain a compliance plan addressing fraud and abuse, beneficiary protection, and program integrity. The compliance plan must include:

• Designated compliance officer.
• Compliance training program.
• Internal compliance audits.
• Process for reporting potential violations.
• Disciplinary policies.

Patient-Centered Criteria

Section 1899(b)(2)(H) requires that ACOs adopt patient-centered criteria, including:

• Promoting evidence-based medicine.
• Engaging in shared decision-making with beneficiaries.
• Patient education.
• Care coordination.
• Patient communication and shared records.

Beneficiary Assignment Methodology

Three-Step Assignment Process

42 CFR 425.402 establishes the beneficiary assignment methodology:

Step 1: Plurality of Primary Care Services from ACO Primary Care Physicians: A Medicare fee-for-service beneficiary is assigned to the ACO if a plurality of the beneficiary's primary care services were rendered by the ACO's primary care physicians (defined to include internal medicine, family medicine, general practice, geriatric medicine, and certain other specialists).

Step 2: Plurality from Non-Primary Care Physicians: If the beneficiary did not receive primary care services from primary care physicians in any ACO, assignment is based on plurality of primary care services received from non-primary care physicians (e.g., specialists who occasionally provide primary care visits).

Step 3: Specialist Services: If the beneficiary received no primary care services at all, assignment is based on specialty services.

Voluntary Alignment

Beneficiaries may voluntarily align with an ACO by completing and submitting an alignment form. Voluntary alignment overrides the standard assignment methodology and aligns the beneficiary regardless of where most primary care services are received.

Prospective vs Retrospective Assignment

The standard MSSP methodology uses retrospective assignment, with final assignment determined after the performance year based on actual services rendered. Some ACO models (including ACO REACH) use prospective assignment, with assignment determined at the start of the performance year. Prospective assignment provides ACOs with more certainty about their attributed population for care management purposes.

Beneficiary Notification

ACOs must notify assigned beneficiaries of their attribution. Notification includes:

• Information about the ACO and its providers.
• Beneficiary rights (including the right to receive care from non-ACO providers).
• Data sharing policies.
• Beneficiary's right to opt out of data sharing.

The BASIC Track and ENHANCED Track Structure

BASIC Track Levels A through E

The BASIC Track provides a glide path from one-sided shared savings to two-sided risk:

BASIC Level A: One-sided shared savings only. ACOs do not owe losses if spending exceeds benchmark. Generally available for ACOs new to MSSP.

BASIC Level B: One-sided shared savings only, with the same maximum savings share as Level A.

BASIC Level C: Two-sided risk, with a higher maximum savings share and a moderate loss share.

BASIC Level D: Two-sided risk, with the same savings share as Level C and a higher loss share.

BASIC Level E: Two-sided risk, with the highest savings and loss share inside the BASIC Track.

Per-level shared savings and shared loss percentages change with each CMS rulemaking cycle, so the current numbers should be confirmed in the CMS Medicare Shared Savings Program regulations at 42 CFR Part 425.

The Pathways to Success rule provides flexibility for some ACOs (particularly Low Revenue ACOs and physician-led ACOs) to remain in one-sided arrangements longer, recognizing capital and operational constraints.

ENHANCED Track

The ENHANCED Track provides maximum risk and reward:

• Two-sided risk.
• The highest shared savings rate available in MSSP.
• Higher shared loss exposure than any BASIC level.
• Higher minimum savings rate (MSR) and minimum loss rate (MLR).
• More flexibility in benefit design.

ENHANCED Track ACOs are typically larger, more experienced ACOs willing to accept higher risk in exchange for higher reward potential.

High Revenue vs Low Revenue ACO Classification

CMS classifies ACOs as High Revenue or Low Revenue based on the proportion of attributed beneficiaries' total spending occurring at ACO participant providers. High Revenue ACOs are generally hospital-led or have substantial hospital participation; Low Revenue ACOs are generally physician-led or rural ACOs.

Low Revenue ACOs receive favorable treatment in several respects:

• More time before required transition to two-sided risk.
• More favorable benchmark methodology in some cases.
• Greater recognition of operational constraints.

Georgia Medicare Shared Savings and Loss Calculation

Benchmark Calculation

The benchmark represents the spending target against which actual spending is compared. The benchmark is calculated based on:

Historical Spending: Three years of historical Medicare fee-for-service spending for the ACO's assigned beneficiaries (or comparable beneficiary populations).

Regional Spending Trend Adjustment: The benchmark is adjusted by regional Medicare spending growth to reflect the cost environment in which the ACO operates.

Risk Adjustment: The benchmark is risk-adjusted based on beneficiary characteristics (age, gender, dual-eligible status, ESRD status, and Hierarchical Condition Category (HCC) risk scores).

Beneficiary Population Adjustments: Adjustments for changes in the beneficiary population over time.

Minimum Savings Rate (MSR) and Minimum Loss Rate (MLR)

To prevent random variation from triggering shared savings or losses, MSSP includes MSR and MLR thresholds:

MSR: The minimum percent savings against benchmark required to share in savings. Set by tiers based on ACO size, with larger ACOs having lower MSRs due to greater statistical reliability. Verify the current MSR table in 42 CFR Part 425 Subpart G.

MLR: The minimum percent losses against benchmark required to owe losses (for two-sided ACOs). Set by similar tiers.

Once the MSR or MLR is exceeded, shared savings or losses are calculated based on the full deviation from benchmark, not just the excess above the threshold (with some exceptions).

Shared Savings Rate

The shared savings rate determines what percentage of savings the ACO receives, and it climbs from the BASIC one-sided levels to the BASIC two-sided levels to the ENHANCED Track. Quality performance scales the actual percentage earned, with strong quality performance qualifying for the maximum and weaker performance reducing it. Confirm current percentages on the Medicare Shared Savings Program page or in the latest CMS MSSP final rule.

Shared Loss Rate (Two-Sided ACOs)

Two-sided ACOs share in losses if spending exceeds benchmark plus MLR. Loss share rises from the lowest two-sided BASIC level to the highest BASIC level and is higher still in the ENHANCED Track, with quality performance influencing the rate in some cases. Current percentages by track and level are published in 42 CFR Part 425 and the most recent MSSP final rule.

Loss Caps and Stop-Loss Provisions

ACOs in two-sided arrangements have loss caps that limit total ACO loss exposure. The cap is typically a percentage of the ACO's benchmark, providing some protection against catastrophic losses. ENHANCED Track ACOs have higher caps reflecting higher risk-bearing capacity.

Quality Measurement and the APP Transition

MSSP Quality Measures Through the Pre-APP Era

Through the years preceding the Alternative Payment Model Performance Pathway (APP) transition, MSSP ACOs reported quality measures across four domains:

Patient Experience: Patient survey-based measures including CAHPS for ACOs, addressing communication, access, timeliness, and overall ratings.

Care Coordination and Patient Safety: Process and structure measures addressing care transitions, medication reconciliation, and patient safety.

Preventive Health: Process and outcome measures addressing immunizations, cancer screenings, and other preventive care.

At-Risk Populations: Outcome measures for specific clinical conditions including diabetes, heart disease, depression, and others.

Transition to APP for CY 2025 and Beyond

Beginning performance year 2025, MSSP transitioned to the Alternative Payment Model Performance Pathway (APP) for quality reporting. The APP framework:

• A streamlined set of quality measures.
• Heavy emphasis on patient experience (CAHPS).
• Claims-based outcome measures (hospital admissions, readmissions, ED utilization).
• Electronic clinical quality measures (eCQMs) reported through certified EHR.
• Mortality measures.
• Coordination with MIPS APM quality reporting.

The transition to APP aligns MSSP quality measurement with other CMS Innovation Center models and reduces reporting burden while maintaining accountability.

Quality Performance Impact on Shared Savings

Quality performance directly affects shared savings eligibility and percentage:

• Failure to meet quality reporting requirements: Loss of shared savings eligibility for the year.
• Lower quality performance: Reduced shared savings percentage.
• Higher quality performance: Maximum shared savings percentage.

ACO-Specific Authorities and Waivers

SNF 3-Day Stay Waiver (Section 1899(i)(1))

Traditional Medicare requires a 3-day inpatient hospital stay before Medicare coverage of subsequent skilled nursing facility care (Section 1812(a)(2)(B) of the Social Security Act). The MSSP waiver authority under Section 1899(i)(1) allows ACO-assigned beneficiaries to be admitted directly to a participating SNF without prior 3-day inpatient stay, supporting efficient post-acute care.

Eligibility requirements:

• ACO must apply for and receive the waiver.
• Beneficiary must be assigned to the ACO.
• SNF must be participating in the ACO's waiver.
• Specific clinical criteria for SNF admission.

Telehealth Expansion (Section 1899(i)(2))

ACOs receive expanded telehealth authority beyond the standard Medicare telehealth restrictions:

• Beneficiary's residence may be the originating site (versus traditional Medicare originating site restrictions to specific provider settings).
• Geographic restrictions waived (versus traditional Medicare restrictions to rural HPSAs).
• Broader services included.

The COVID-19 public health emergency dramatically expanded Medicare telehealth generally, and many of those expansions have been extended through legislation and remain in effect. ACO-specific telehealth authorities continue to apply.

Beneficiary Engagement Incentive Programs (Section 1899(i)(3))

ACOs may operate beneficiary incentive programs to encourage primary care engagement. Authority includes:

• Limited payments to beneficiaries for completing qualifying primary care visits.
• Other forms of beneficiary engagement support.

The incentive program waivers reflect CMS recognition that increased primary care engagement supports better outcomes and lower total costs.

Coordinated AKS and Stark Waivers

OIG and CMS have coordinated rulemaking to provide fraud-and-abuse waivers for ACO arrangements. Waivers include:

Pre-Participation Waiver: Allows arrangements to be structured during the pre-participation period.

Participation Waiver: Allows ACO participants to make payments and distributions during participation.

Shared Savings Distribution Waiver: Allows distribution of MSSP shared savings to ACO participants and other parties.

Compliance with Quality Assurance and Improvement Program Waiver: Allows arrangements to satisfy quality assurance and improvement program requirements.

Patient Incentive Waiver: Allows beneficiary engagement incentive program payments.

The 2020 modernization of Stark and AKS regulations added broad value-based exceptions and safe harbors that also support ACO arrangements.

The ACO REACH Model

Background

The ACO REACH Model (Realizing Equity, Access, and Community Health) is a CMS Innovation Center model administered under Section 1115A authority. ACO REACH replaced the Global and Professional Direct Contracting Models.

ACO REACH Participant Categories

ACO REACH includes three participant categories:

Standard ACO REACH: For organizations with existing CMS Innovation Center experience or established Medicare ACO relationships. Standard category emphasizes Medicare beneficiary alignment and care coordination.

New Entrant ACO REACH: For organizations newer to value-based care, including provider-led organizations and physician practices entering risk arrangements for the first time. Includes additional implementation support.

High Needs Population ACO REACH: For organizations focused specifically on high-acuity, complex-needs Medicare beneficiaries. Includes specialized care management capabilities and risk-adjustment for high-needs populations.

Health Equity Plan Requirements

A distinctive feature of ACO REACH is the mandatory Health Equity Plan, requiring each participating ACO to:

• Identify health disparities in the served population.
• Develop interventions to address disparities.
• Collect beneficiary-level health equity data.
• Report on equity metrics.
• Implement equity-focused care management.

The Health Equity Plan reflects CMS Innovation Center's strategic priority on health equity and represents a significant evolution of accountable care model design.

ACO REACH Capitation Options

ACO REACH offers capitation options beyond MSSP:

• Total Care Capitation: Full per-member-per-month capitation for all Medicare Parts A and B services.
• Primary Care Capitation: Capitation for primary care services only.
• Risk-Based Payment: Various forms of risk-based payment arrangements.

The capitation options provide more financial flexibility than MSSP and support population health management approaches.

Legacy ACO Models

Pioneer ACO Model

The Pioneer ACO Model was an early CMS Innovation Center demonstration. Pioneer ACOs were larger, more experienced healthcare organizations that took on more risk than initial Track 1 MSSP ACOs. The model tested whether ACOs willing to take greater risk could achieve greater savings. Findings informed subsequent Innovation Center model design.

Next Generation ACO Model

The Next Generation ACO Model ran as a CMS Innovation Center initiative. The model provided:

• More aggressive risk-bearing options.
• Greater benefit design flexibility.
• Higher shared savings potential.
• Beneficiary engagement tools.

Next Generation ACOs were generally larger, more experienced ACOs willing to accept Substantial risk. The model's findings informed the design of Direct Contracting and ACO REACH.

Direct Contracting Models

The Direct Contracting Models included:

• Global Direct Contracting: Full Total Cost of Care capitation.
• Professional Direct Contracting: Partial capitation for primary care services.
• Geographic Direct Contracting: Geographic-based risk arrangements (paused).

The Direct Contracting models were restructured into ACO REACH, with substantial modifications including the Health Equity Plan requirement and refined risk arrangements.

The CMS Innovation Center

Section 1115A Authority

The CMS Innovation Center (CMMI) was established by Section 3021 of the ACA and is authorized at Section 1115A of the Social Security Act. The Innovation Center has authority to:

• Test innovative payment and service delivery models.
• Expand successful models with HHS Secretary approval.
• Develop and implement model parameters.
• Evaluate model outcomes.

The Innovation Center has been a major driver of ACO innovation, value-based care development, and Medicare payment evolution.

The 10-Year Strategy and Accountable Care Goal

CMS announced the Innovation Center's 10-Year Strategy with five strategic objectives:

1. Drive Accountable Care: Enroll all traditional Medicare beneficiaries in accountable care relationships.

2. Advance Health Equity: Reduce disparities and improve outcomes for underserved populations.

3. Support Care Innovation: Develop and scale innovative care models.

4. Address Affordability: Reduce healthcare costs while maintaining quality.

5. Partner to Achieve System Transformation: Collaborate with stakeholders to drive value-based transformation.

Achieving this accountable care goal will require ongoing MSSP and ACO REACH expansion plus new models targeting populations not currently in accountable care arrangements.

The Georgia Medicare ACO Shared Savings Program Landscape

Major Health System ACOs

Wellstar Health System ACO: Wellstar operates a large MSSP ACO covering metro Atlanta and surrounding areas. Wellstar's ACO leverages the system's employed physician network, hospital infrastructure, and care management capabilities.

Piedmont Healthcare ACO: Piedmont operates an ACO covering Atlanta metro and additional Georgia regions through Piedmont's expanded hospital footprint (including Piedmont Athens Regional, Piedmont Newton, and others).

Emory Healthcare ACO: Emory's ACO leverages the academic medical center's clinical capabilities and comprehensive care delivery.

Northside Hospital ACO: Northside participates in ACO arrangements covering metro Atlanta.

Augusta University Health System ACO: Augusta University's ACO covers east Georgia.

Physician-Led ACOs

Many independent physician-led ACOs operate throughout Georgia, often qualifying as Low Revenue ACOs eligible for favorable risk transition timelines. Physician-led ACOs typically include:

• Internal medicine and family medicine practices.
• Multispecialty group practices.
• Independent physician associations (IPAs).
• Clinical integration networks.

Physician-led ACOs leverage primary care relationships, care management capabilities, and clinical integration to improve care coordination and outcomes.

Industry Organizations Serving Georgia ACOs

• NAACOS (National Association of ACOs): Major industry organization providing education, advocacy, and resources for ACOs nationally.
• Premier Inc.: Healthcare improvement company supporting ACO operations.
• Health Care Transformation Task Force: Industry consortium advancing value-based care.
• AHA Center for Health Innovation: American Hospital Association resource for innovation.
• AMGA (American Medical Group Association): Multispecialty group practice organization.
• Georgia Hospital Association: State hospital association providing ACO resources.

Worked Example 1: Wellstar ACO BASIC Track Participation

Scenario: Wellstar Health System participates in MSSP through a BASIC Level C ACO covering 50,000 attributed Medicare fee-for-service beneficiaries across metro Atlanta.

ACO Structure:

• Wellstar hospitals and employed physician practices.
• Affiliated independent physician practices via clinical integration.
• BASIC Level C: Two-sided risk, with the maximum shared savings rate specified in 42 CFR Part 425 for the level.

Benchmark Calculation:

• 3-year historical spending baseline: $750 million per year.
• Regional trend adjustment: 3 percent growth.
• Risk adjustment for beneficiary characteristics.
• Final benchmark for performance year: $775 million.

Actual Performance:

• Performance year actual spending: $755 million.
• Savings against benchmark: $20 million.
• Minimum Savings Rate (MSR): 2.5 percent ($19.4 million threshold).
• Savings exceed MSR, qualifying for shared savings.

Quality Performance:

• ACO meets quality performance standards.
• Maximum shared savings percentage applies.

Shared Savings Calculation:

• Shared savings to Wellstar: a portion of the $20 million savings calculated at the BASIC Level C rate published in 42 CFR Part 425, scaled by quality performance.
• Distributed among ACO participants per Wellstar's distribution methodology.

Care Management Investment:

• Wellstar invests in care management staff, technology, and clinical pathways.
• ROI calculation considers investment costs against shared savings.

Outcome: Wellstar achieves shared savings through effective care coordination, primary care engagement, and post-acute care management.

Worked Example 2: Independent Physician-Led ENHANCED Track ACO

Scenario: An independent physician-led ACO in Georgia, consisting of 200 primary care physicians and selected specialists, has been operating in MSSP for 5 years and has now transitioned to the ENHANCED Track.

ACO Structure:

• Network of independent practices.
• Low Revenue ACO classification (physician-led, limited hospital participation).
• ENHANCED Track: highest shared savings rate available in MSSP, with corresponding higher loss exposure; current ENHANCED rates published in 42 CFR Part 425.

Benchmark:

• 60,000 attributed beneficiaries.
• Annual benchmark approximately $720 million.

Performance Year Outcome:

• Actual spending: $700 million.
• Savings against benchmark: $20 million.
• MSR exceeded.
• Quality performance: Strong, qualifying for maximum savings rate.

Shared Savings Calculation:

• ACO shared savings: a portion of the $20 million savings calculated at the ENHANCED Track rate published in 42 CFR Part 425, scaled by quality performance.
• Distribution among physician practices per ACO governance.

Risk Bearing:

• If spending exceeded benchmark beyond the minimum loss threshold, the ACO would owe shared losses at the ENHANCED Track loss-share rate, again adjusted by quality performance.
• Risk transfer through reinsurance or hospital partnerships often used to manage risk exposure.

Care Model:

• Heavy emphasis on primary care.
• Population health management.
• Care management for high-risk patients.
• Reduced specialty utilization through referral management.
• Quality-driven incentive payments to participating physicians.

Outcome: The physician-led ENHANCED Track ACO achieves substantial shared savings through population health management and effective primary care coordination.

Worked Example 3: ACO REACH Standard Model

Scenario: A major Georgia health system participates in ACO REACH Standard model with Total Care Capitation arrangement.

ACO REACH Structure:

• Standard category (existing CMS Innovation Center experience).
• 40,000 attributed Medicare beneficiaries through prospective alignment.
• Total Care Capitation for all Parts A and B services.

Capitation Calculation:

• Per-member-per-month (PMPM) capitation rate calculated based on:
  • Historical Medicare spending for assigned beneficiaries.
  • Risk adjustment.
  • Regional benchmark.
• Annualized capitation: approximately $1.2 billion for 40,000 beneficiaries.

Health Equity Plan:

• Beneficiary-level health equity data collection.
• Identification of disparities in care access and outcomes.
• Targeted interventions for underserved populations.
• Annual reporting on equity metrics.

Risk Bearing:

• ACO assumes full risk for capitated services.
• Risk-sharing arrangements with primary care providers, hospitals, and specialists.
• Stop-loss reinsurance for catastrophic cases.

Performance Year Outcome:

• Actual spending: $1.15 billion.
• Margin: $50 million (4.2 percent of capitation).
• Quality performance affects retention of margin.

Outcome: The ACO REACH Standard model provides substantial financial flexibility and full risk-bearing, supporting comprehensive population health management.

Worked Example 4: Beneficiary Assignment for Primary Care

Scenario: A Georgia Medicare beneficiary in metro Atlanta sees multiple healthcare providers throughout the year. The beneficiary's assignment to an ACO follows the three-step methodology.

Beneficiary Profile:

• 72-year-old Medicare fee-for-service beneficiary.
• Primary care services: 6 visits at a Wellstar-affiliated primary care practice.
• Specialty care: cardiology visits at Northside Cardiovascular.
• Hospitalizations: one inpatient stay at Piedmont Hospital.

Step 1 Analysis: Plurality of primary care services from ACO primary care physicians.

• Wellstar primary care practice: 6 of the beneficiary's 6 primary care visits.
• Wellstar primary care practice is part of Wellstar ACO.
• Plurality (and majority) of primary care services from Wellstar ACO.
• Beneficiary assigned to Wellstar ACO.

Outcome: Beneficiary attributed to Wellstar ACO for performance year.

Beneficiary Implications:

• Beneficiary retains right to see any Medicare-participating provider (not restricted to Wellstar).
• Wellstar receives attribution credit for the beneficiary's total Medicare spending.
• Beneficiary may benefit from Wellstar ACO care management programs.
• Voluntary alignment forms may be used by beneficiary to change attribution.

Worked Example 5: Shared Savings Calculation Walkthrough

Scenario: A Georgia ACO has 30,000 attributed beneficiaries in BASIC Level B (one-sided shared savings only).

Benchmark: $450 million for the performance year.

Actual Spending: $440 million.

Calculation:

• Savings against benchmark: $450 million - $440 million = $10 million.
• Savings as percent of benchmark: $10 million / $450 million = 2.22 percent.
• ACO Minimum Savings Rate (MSR): 2.5 percent (smaller ACOs have higher MSR).
• Savings (2.22 percent) below MSR (2.5 percent).
• ACO does not qualify for shared savings this year.

Alternative Scenario with Higher Savings:

• Actual spending: $432 million.
• Savings: $18 million (4.0 percent of benchmark).
• MSR (2.5 percent) exceeded.
• ACO qualifies for shared savings.

Quality-Adjusted Savings:

• Quality performance score: a strong-but-not-maximum result.
• Shared savings percentage: BASIC Level B maximum rate (per 42 CFR Part 425) scaled by the ACO's quality performance score.
• Shared savings to ACO: a portion of the $18 million in savings, distributed among ACO participants per the ACO's distribution methodology.

Outcome: The ACO would receive a portion of the savings as shared savings, distributed among ACO participants per the ACO's distribution methodology.

Worked Example 6: Quality Measure Performance APP Transition

Scenario: A Georgia ACO is transitioning from the prior MSSP quality reporting framework (covering four domains) to the APP framework for CY 2025.

Prior Year Quality Reporting:

• A multi-measure set spread across patient experience, care coordination/patient safety, preventive health, and at-risk populations.
• Manual data collection from EHR and claims.
• Substantial reporting burden.

APP Quality Reporting (CY 2025+):

• A streamlined measure set that includes:
  • Electronic clinical quality measures (eCQMs) reported from certified EHR.
  • CAHPS for ACOs patient experience survey.
  • Claims-based measures (hospital admissions, readmissions, ED utilization).
  • Mortality measure.
• Reduced reporting burden.
• Greater emphasis on outcome measures.

Verify the current APP measure set on the Alternative Payment Model Performance Pathway page.

Implementation Steps:

• ACO EHR configured for APP eCQM reporting.
• CAHPS for ACOs administration.
• Claims-based measure automatic calculation by CMS.
• Annual quality reporting through certified EHR.

Performance Impact:

• APP performance score directly affects shared savings percentage.
• Strong APP performance qualifies for maximum savings.
• ACO invests in quality improvement programs targeting APP measures.

Outcome: The ACO successfully transitions to APP reporting with reduced burden and improved quality measurement alignment with broader CMS Innovation Center models.

Best Practices for Georgia Healthcare Entities Considering ACO Participation

1. Conduct readiness assessment: Evaluate organizational capabilities for ACO participation, including primary care strength, care management infrastructure, EHR capabilities, data analytics, and risk-bearing capacity.

2. Engage primary care physicians: Primary care relationships are the foundation of ACO success. Engage primary care physicians early, address their concerns, and develop clear value propositions.

3. Develop care management infrastructure: Invest in care managers, transitional care, chronic care management, and post-acute care management capabilities to deliver on ACO promises.

4. Build data analytics capabilities: ACOs require sophisticated data analytics for population health management, performance tracking, and care management targeting. Invest in data warehousing, analytics tools, and analyst capabilities.

5. Choose the right track: Select the BASIC Track Level (A through E) or ENHANCED Track based on risk-bearing capacity, primary care strength, and strategic objectives. Most ACOs start in BASIC Level A or B.

6. Plan for risk transition: Pathways to Success requires most ACOs to move into two-sided risk within 5 years. Plan strategically for the transition, including infrastructure investments and risk management arrangements.

7. Implement quality improvement programs: Quality performance directly affects shared savings. Implement systematic quality improvement programs targeting APP measures.

8. Coordinate post-acute care: Post-acute spending is a major driver of total spending. Develop SNF, IRF, LTCH, and home health partnerships to manage post-acute utilization.

9. Engage beneficiaries: Use beneficiary engagement incentive programs (where applicable) and broader engagement strategies to support primary care utilization and care management participation.

10. Use telehealth strategically: ACO telehealth waivers and post-COVID telehealth flexibility expansion support care delivery innovations. Implement telehealth strategically for chronic care management, post-acute follow-up, and primary care access.

11. Coordinate with hospital partners: Hospital-physician collaboration through ACO arrangements requires careful coordination. Engage hospital leadership in ACO strategy development.

12. Implement compliance program: ACOs must maintain compliance programs addressing fraud and abuse, beneficiary protection, and program integrity. Ensure compliance program includes ACO-specific requirements.

13. Plan for ACO REACH consideration: Beyond MSSP, ACO REACH provides additional capitation options. Evaluate ACO REACH participation as organizational capabilities mature.

14. Monitor regulatory developments: ACO regulations continue to evolve. Stay informed about CMS rulemaking, Innovation Center model developments, and quality measure refinements.

Common Issues and How to Address Them

1. Below-threshold savings (MSR not exceeded): Savings below MSR do not qualify for shared savings, even if positive. Solution: Implement aggressive care management to maximize savings; recognize that some performance years may not generate shared savings.

2. Quality performance below threshold: Failure to meet quality requirements eliminates shared savings eligibility. Solution: Implement systematic quality improvement programs; invest in CAHPS performance; ensure eCQM reporting compliance.

3. Risk transition pressure: Pathways to Success requires risk transition; some ACOs lack risk-bearing capacity. Solution: Plan transition carefully; consider reinsurance or stop-loss arrangements; evaluate organizational capacity.

4. Primary care physician engagement challenges: ACO success requires primary care engagement, but physicians may be skeptical or constrained. Solution: Align financial incentives; address operational concerns; provide clear value proposition.

5. Specialty utilization management: Specialty utilization drives total spending; ACOs must manage referrals without compromising care. Solution: Specialist network agreements; referral management protocols; quality-driven specialist selection.

6. Beneficiary leakage: Beneficiaries seeking care outside ACO network reduce ACO control over spending. Solution: Patient engagement programs; primary care access improvements; in-network care coordination.

7. Data integration challenges: ACOs need integrated data across multiple sources; many lack robust data systems. Solution: Invest in data integration; use CMS Claim and Claim Line Feed (CCLF) data; consider third-party analytics platforms.

8. Compliance plan implementation: ACO compliance plans require ongoing operation. Solution: Designated compliance officer; regular training; documented audits.

9. Distribution methodology disputes: Distribution of shared savings can create internal disputes. Solution: Clear distribution methodology established at ACO formation; transparent governance; performance-based allocations.

10. APP transition burden: Quality measure transition requires EHR configuration and process changes. Solution: Begin transition planning early; engage EHR vendor; train staff on new reporting.

11. Post-acute network optimization: Post-acute referrals to non-network providers reduce ACO control. Solution: Preferred SNF partnerships; care management for post-acute placement; outcomes-based provider selection.

12. Voluntary alignment recruitment: Beneficiary voluntary alignment can support ACO attribution. Solution: Patient engagement programs; clear communication of ACO value; alignment form distribution at primary care visits.

13. Telehealth implementation: Telehealth requires technology, training, and workflow changes. Solution: Phased telehealth implementation; provider training; patient education on telehealth options.

14. Health Equity Plan compliance (ACO REACH): ACO REACH Health Equity Plan requirements are substantial. Solution: Engage health equity expertise; develop comprehensive equity strategy; collect required data systematically.

A few more common questions:

What is the Medicare Shared Savings Program (MSSP)? The Medicare Shared Savings Program was established by Section 3022 of the Affordable Care Act of 2010 (Public Law 111-148, signed March 23, 2010) and codified at Section 1899 of the Social Security Act. MSSP enables groups of doctors, hospitals, and other healthcare providers to come together as ACOs to coordinate care for Medicare fee-for-service beneficiaries and share in savings achieved by providing high-quality, lower-cost care. The program is implemented through 42 CFR Part 425.

What is the Pathways to Success rule? The CMS Pathways to Success Final Rule substantially restructured MSSP. The rule replaced the original three tracks (Track 1 one-sided, Track 2 two-sided, Track 3 higher risk) with the BASIC Track (Levels A through E with progressively increasing risk) and the ENHANCED Track (maximum risk and reward). The rule accelerated transitions to two-sided risk and aimed to address findings that one-sided ACOs were not generating sufficient Medicare savings.

What is the difference between BASIC Track and ENHANCED Track? The BASIC Track provides a glide path from one-sided shared savings (Levels A and B) to two-sided risk (Levels C, D, E). The ENHANCED Track provides maximum risk and reward, with the highest shared savings rate in MSSP and the highest corresponding loss rates. Current per-level percentages are published in 42 CFR Part 425.

How is the ACO benchmark calculated? The benchmark represents the spending target against which actual spending is compared. It is based on three years of historical Medicare fee-for-service spending for the ACO's assigned beneficiaries (or comparable populations), adjusted for regional Medicare spending growth, beneficiary risk characteristics (age, gender, dual-eligible status, ESRD status, HCC risk scores), and changes in the beneficiary population over time.

What is the Minimum Savings Rate (MSR)? The MSR is the threshold percent of savings against benchmark required to qualify for shared savings. MSR prevents random variation from triggering shared savings or losses; it varies by ACO size, with larger ACOs having lower MSRs because their performance is more statistically reliable. Once exceeded, shared savings are calculated based on the full deviation from benchmark.

What is the SNF 3-day stay waiver for ACOs? Traditional Medicare requires a 3-day inpatient hospital stay before Medicare coverage of subsequent skilled nursing facility care (Section 1812(a)(2)(B)). Section 1899(i)(1) authorizes a waiver allowing ACO-assigned beneficiaries to be admitted directly to a participating SNF without a prior 3-day inpatient stay.

What telehealth flexibilities apply to ACOs? Section 1899(i)(2) authorizes telehealth expansions for ACOs beyond standard Medicare telehealth restrictions. ACO-assigned beneficiaries may receive telehealth at their residence (rather than only at specific provider settings), and geographic restrictions to rural Health Professional Shortage Areas are waived. The COVID-19 public health emergency also dramatically expanded Medicare telehealth generally.

What is the beneficiary engagement incentive program? Section 1899(i)(3) authorizes ACOs to make limited payments to beneficiaries for primary care visit engagement. The incentive program reflects CMS recognition that increased primary care engagement supports better outcomes and lower total costs.

What fraud-and-abuse waivers apply to ACOs? OIG and CMS have coordinated rulemaking to provide fraud-and-abuse waivers for ACO arrangements: Pre-Participation Waiver, Participation Waiver, Shared Savings Distribution Waiver, Compliance with Quality Assurance and Improvement Program Waiver, and Patient Incentive Waiver. The modernization of Stark and AKS regulations also added broad value-based exceptions and safe harbors that support ACO arrangements.

How does MSSP quality measurement work? Pre-APP, MSSP ACOs reported quality measures across four domains (patient experience, care coordination/patient safety, preventive health, at-risk populations). Beginning CY 2025, MSSP transitioned to the Alternative Payment Model Performance Pathway (APP), using a streamlined set of measures including patient experience (CAHPS), claims-based outcomes (hospital admissions, readmissions), eCQMs from certified EHR, and mortality measures.

What is the difference between High Revenue and Low Revenue ACOs? CMS classifies ACOs as High Revenue or Low Revenue based on the proportion of attributed beneficiaries' total spending occurring at ACO participant providers. High Revenue ACOs are generally hospital-led; Low Revenue ACOs are generally physician-led or rural. Low Revenue ACOs receive favorable treatment including more time before required transition to two-sided risk.

What were the Pioneer ACO and Next Generation ACO models? The Pioneer ACO Model (2012-2016) was an early Innovation Center demonstration testing higher-risk ACO arrangements. The Next Generation ACO Model (2016-2021) provided more aggressive risk-bearing, benefit design flexibility, and higher savings potential. Both informed the design of Direct Contracting and ACO REACH.

How do ACOs use data? ACOs use Medicare claims data (provided by CMS through the Claim and Claim Line Feed, or CCLF) and clinical data (from EHRs and other sources) to identify high-risk beneficiaries needing care management, track care patterns and quality outcomes, analyze utilization and spending, coordinate care across providers, and report quality measures.

How is shared savings distributed within an ACO? Each ACO establishes its own distribution methodology, governed by ACO governance documents and addressed through specific fraud-and-abuse waiver protections. Common approaches include distribution proportional to ACO participant contribution, distribution proportional to attributed beneficiaries, performance-based distribution, and investment-based distribution.

Where can Georgia healthcare entities get ACO assistance? Resources include NAACOS (National Association of ACOs) at naacos.com; Premier Inc.; Health Care Transformation Task Force; the CMS Innovation Center; Georgia Hospital Association at 770-249-4500; and Medical Association of Georgia at 404-876-7535. Beneficiaries can contact 1-800-MEDICARE, GeorgiaCares SHIP (1-866-552-4464), or Medicare Rights Center (1-800-333-4114) for ACO-related questions.

Brevy: Your Partner in Understanding Medicare's Value-Based Future

At Brevy (brevy.com), our mission is to provide Georgia families with comprehensive, up-to-date guidance on Medicare, Medicaid, VA benefits, and the broader eldercare landscape. The Medicare Shared Savings Program and broader ACO ecosystem represent the most significant evolution of Medicare payment and care delivery in a generation. As CMS pursues its goal of expanding accountable care across traditional Medicare, ACOs increasingly shape the care experience for Georgia Medicare beneficiaries.

If you or a family member is enrolled in traditional Medicare and is attributed to an ACO, the ACO's care management programs, primary care engagement initiatives, and quality improvement efforts may be available to support your care. Contact your primary care physician's office to learn whether they participate in an ACO and what services may be available. Brevy continuously updates our content to reflect ACO program changes, quality measure transitions, and the broader CMS Innovation Center model evolution.

Find personalized help navigating Medicare ACOs and value-based care at brevy.com.