Round Three of Next Generation ACO Model is Introduced by CMS Innovation Center
Round Three of Next Generation ACO Model is Introduced by CMS Innovation Center

The Center for Medicare and Medicaid Services (CMS) Innovation Center has opened a third application round for its Next Generation Accountable Care Organization (ACO) Model. CMS is dedicated to improving care, improving health, and decreasing expenditures for Medicare, Medicaid and the Children’s Health Insurance Program (CHIP). To meet this end, its accountable care programs bring together providers and suppliers who jointly accept responsibility for the cost and quality of care outcomes for particular groups of beneficiaries. The Next Generation ACO Model is specifically focused on financial incentives and whether such incentives help ACOs improve outcomes and reduce costs.

With experience from the Pioneer ACO Model and the Medicare Shared Savings Program, the Next Generation ACO model offers a higher-risk, higher-reward financial arrangement. Applicants will choose a payment mechanism, which may be: normal fee-for-service (FFS) payment plus an additional per-beneficiary per-month payment; population-based payments; or an all-inclusive population-based payment.

A Next Generation ACO can be created by Next Generation Participants (defined in the Request for Applications) arranged as: physicians or practitioners in group practice; networks of individual practices of physicians or practitioners; hospitals employing physicians or practitioners; partnerships or joint ventures between hospitals and physicians or practitioners; Federally Qualified Health Centers; rural health clinics; or critical access hospitals. In addition, any Medicare-enrolled provider or supplier may participate in an ACO formed by one or more of these entities.

Important dates for Round Three of the Next Generation ACO Model include:

  • A webinar reviewing the program and how to submit a Letter of Intent (LOI) will be held January 31.
  • A mandatory LOI is due May 4, 2017 (while mandatory, the LOI is not binding).
  • The application narrative is due May 18, 2017.
  • The proposed Provider and Service Areas lists are due June 9, 2017.

It is anticipated that the application portal will be available in March. The number of awardees will be based on the number of applicants and available funds. Selected ACOs will be bound to an initial one-year performance agreement with the potential for two additional years. To view the 45 ACOs currently participating in the Next Generation ACO Model, click here.