ACO REACH vs. MSSP: How to Choose the Right Path to Value-Based Care

For healthcare organizations pursuing advanced primary care strategies, one of the most pressing questions isn’t whether to move into value-based care—it’s how. With CMS pushing toward its 2030 goal of connecting all traditional Medicare beneficiaries to accountable care, provider groups face a pivotal choice between two dominant Medicare models: ACO REACH vs. MSSP.

The Medicare Shared Savings Program (MSSP) and the Accountable Care Organization Realizing Equity, Access, and Community Health (ACO REACH) model both aim to improve outcomes and reduce costs, but they differ in scale, risk, and approach. Understanding these distinctions can help leaders align their choices with organizational readiness, patient demographics, and financial strategy.

What is MSSP?

The Medicare Shared Savings Program (MSSP) is the largest and most established accountable care initiative in the U.S. Launched in 2012, it’s a permanent program that encourages groups of physicians, hospitals, and other providers to come together as an Accountable Care Organization (ACO) to deliver coordinated, high-quality care for people with Medicare while reducing unnecessary costs.¹

MSSP is a model that:²

• Promotes accountability for a patient population.

• Coordinates services for Medicare fee-for-service (FFS) beneficiaries.

• Encourages investment in high-quality, efficient care.

As of 2025, MSSP includes 476 participating Accountable Care Organizations (ACOs) caring for more than 11.2 million people with Traditional Medicare, supported by more than 655,000 providers and organizations across the country.³

What is ACO REACH?

The Accountable Care Organization Realizing Equity, Access, and Community Health (ACO REACH) model is an accountable care initiative led by the CMS Innovation Center. Introduced in 2023 as the successor to the Global and Professional Direct Contracting model, ACO REACH was created to strengthen provider leadership, advance health equity, and expand accountable care options for Medicare beneficiaries.⁴

ACO REACH is a model that:⁴

• Ensures provider-led governance, requiring that participating clinicians and organizations hold at least 75 percent of voting control on the ACO’s governing board—shaping decisions around care delivery, resource allocation, and program participation.

• Elevates the patient voice by requiring two voting beneficiary advocates on each ACO’s governing board.

• Increases transparency and oversight through enhanced CMS monitoring and reporting requirements.

As of 2025, ACO REACH includes 103 participating ACOs serving approximately 2.5 million aligned Medicare beneficiaries through more than 161,000 providers and organizations nationwide.³

For organizations exploring this model, details on participation requirements, payment tracks, and 2026 updates are available in our free, downloadable ACO REACH Model Reference Guide PDF.

ACO REACH Model Quick Reference Guide PDF

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Beneficiary alignment and scale

One of the most significant differences between the models is how many beneficiaries an organization must serve to participate.

MSSP

Requires a minimum of 5,000 beneficiaries at all participation levels. This makes the program best suited for larger health systems or established provider groups with a broad patient base.⁵

ACO REACH

Offers lower beneficiary requirements for certain ACO types, making the model more accessible to newer or more specialized organizations compared to MSSP:⁴

• New Entrant ACOs: 4,000 beneficiaries in 2025, rising to 5,000 in 2026.

• High-Needs ACOs: 1,000 beneficiaries in 2025, rising to 1,250 in 2026.

• Standard ACOs: 5,000 beneficiaries.

MSSP provides stability for large, established organizations, while ACO REACH lowers the barrier for new entrants and safety-net providers. The different thresholds show how ACO REACH vs. MSSP reflect two pathways into accountable care—one built for scale, the other for accessibility.

Payment models and risk structures

The way payments are structured and financial risk is distributed is one of the most significant differences between ACO REACH and MSSP. These design choices influence not only organizational revenue but also the level of financial accountability required from participants.

MSSP

• Providers within participating ACOs continue to receive fee-for-service payments directly from CMS.

• ACOs share in savings (or losses) depending on performance relative to their benchmark.

• The program allows organizations to start with shared-savings-only arrangements (where they share in savings but not losses) and gradually transition to two-sided risk models, giving them time to build experience.

ACO REACH

• ACOs receive capitated payments, either Primary Care Capitation (PCC) or Total Care Capitation (TCC), depending on their chosen track.⁶

• Capitation provides predictable revenue but requires strong financial and care-management infrastructure.

• ACOs can design their own internal payment and bonus structures for the providers they contract with, offering greater flexibility in how incentives are distributed.

• All tracks include mandatory downside risk, meaning organizations must be prepared for both rewards and losses.

MSSP prioritizes incremental adoption with a proven on-ramp to value-based care, while ACO REACH accelerates organizations into advanced risk-sharing and capitation models.

Health equity focus

Both models incorporate measures to address disparities. For organizations serving diverse or high-needs populations, the health equity strategies in ACO REACH vs. MSSP may strongly influence which model is the better fit.

MSSP

• The program also offers infrastructure payments to help organizations build the capacity to serve high-needs patients, such as dual-eligible beneficiaries or those in medically underserved areas.

ACO REACH

• Requires every ACO to develop and submit a health equity plan outlining strategies to reduce disparities in care.⁷

• Introduces what CMS now calls the population adjustment—formerly known as the Health Equity Benchmark Adjustment (HEBA)—to provide additional financial support for organizations serving high-cost or high-risk populations, such as dual-eligible beneficiaries, low-income subsidy recipients, and patients living in high-deprivation areas.⁸

• Requires participating ACOs to collect relevant demographic and social risk data to monitor equity goals and track progress across populations.

While MSSP has removed its health equity adjustment, ACO REACH continues to require equity-focused strategies through its population adjustment and health equity plans.

Quality measurement and reporting

Reporting requirements are another area where ACO REACH vs. MSSP take different paths, shaping how resource-intensive participation can be depending on an organization’s infrastructure.

MSSP

• Offers several reporting frameworks, including electronic (eCQMs), Merit-based Incentive Payment System (MIPS), and Medicare clinical quality measures.

• Requires ACOs to report clinical quality and patient experience data, while CMS calculates additional performance measures from Medicare claims.

• For organizations with strong EHR capabilities, eCQM reporting can streamline submissions, but smaller or less tech-enabled providers may find the process resource-intensive.

ACO REACH

• Relies primarily on claims-based quality measures, significantly reducing the administrative burden.

• Still maintains accountability for patient experience and health outcomes, but with less manual data submission compared to MSSP.

• This approach is particularly appealing to organizations looking for simplicity, allowing them to focus more on care delivery and financial risk management than on reporting logistics.

MSSP offers flexibility but often comes with heavier reporting lift, while ACO REACH emphasizes simplicity by relying more on claims-based measures. This highlights how ACO REACH vs. MSSP offer very different reporting experiences, shaping how organizations allocate resources to compliance versus care delivery.

What’s next for ACO REACH vs. MSSP

Both the MSSP and the ACO REACH model continue to evolve as CMS refines program rules to strengthen accountability, improve sustainability, and align incentives.

MSSP

Under the finalized CY 2026 Medicare Physician Fee Schedule rule, CMS introduced several refinements to MSSP:

• Shorter time in one-sided risk arrangements: ACOs may remain in the one-sided (shared-savings-only) BASIC track for up to five performance years during their first agreement period (for new agreements beginning in 2027). After that, they must transition to two-sided risk models that include shared savings and losses, accelerating financial accountability and aligning incentives earlier in participation.

• Beneficiary minimum flexibility: ACOs must maintain at least 5,000 assigned beneficiaries by Benchmark Year 3, but may fall below that number in earlier years if safeguards are met. The policy provides smaller or newer ACOs time to scale before meeting full requirements.

• Quality measure updates: CMS updated the Alternative Payment Model (APM) Performance Pathway Plus (APP Plus) measure set, which serves as the required group of quality measures for MSSP ACOs. Updates include removing Quality ID 487 (Screening for Social Drivers of Health) and transitioning the CAHPS for MIPS survey to a web-mail-phone format starting in 2027. These changes streamline reporting and align MSSP quality measurement with CMS’s broader quality programs.

• Equity terminology change: CMS renamed the Health Equity Benchmark Adjustment to the “population adjustment” to better reflect its purpose—accounting for the proportion of beneficiaries who are dually eligible for Medicare and Medicaid or receive the Part D Low-Income Subsidy.

ACO REACH

Starting in Performance Year 2026, CMS will implement several refinements to the ACO REACH model:¹⁰

• Risk score constraints: New caps on early-year risk score growth, with a higher ceiling for High-Needs ACOs. The update limits aggressive coding while protecting organizations that serve the sickest and most complex patients.

• Benchmark blend shift: Standard ACOs will move to a 60/40 historical-to-regional blend, making benchmarks more dependent on each ACO’s own past performance and reducing regional variation advantages.

• Risk corridor narrowing: A new risk corridor policy for ACOs in the Global risk option (100 percent risk) will shrink the first risk corridor—from 25 to 10 percent—so that savings or losses above 10 percent of an ACO’s benchmark are now shared with CMS. This change increases financial exposure for participating ACOs, making performance results more sensitive to care costs and utilization trends.

• Quality withhold increase: A portion of each ACO’s benchmark payment—known as the quality withhold—will increase from 2 to 5 percent, with unearned funds redistributed through the High Performers Pool (HPP) bonus. This change raises the stakes for quality performance while rewarding continuous improvement and exceptional outcomes.

MSSP vs. ACO REACH: Which model fits your organization?

To help clarify the differences, here’s a side-by-side comparison of ACO REACH vs. MSSP across key features: 

Which model is right for you?

The right choice between ACO REACH vs. MSSP depends on your organization’s size, readiness, and long-term strategy.

MSSP may be the better fit if:

• Your organization is new to value-based care and needs a gradual entry point.

• You prefer to limit downside risk while building experience.

• You already have a large enough patient base to meet the 5,000-beneficiary minimum.

• You want the stability of a permanent CMS program with a long track record.

ACO REACH may be the better fit if:

• Your team is prepared to accept mandatory downside risk from the start.

• You want to explore capitated payments and more flexible financial arrangements.

• You serve a high-needs or underserved population that benefits from tailored support.

• You are committed to equity-driven strategies and a streamlined reporting structure.

ACO REACH vs. MSSP: Key takeaways for leaders

Both MSSP and ACO REACH are critical components of CMS’s 2030 vision for traditional accountable care. MSSP provides stability and a gradual path into value-based care, making it well-suited for large or newly transitioning organizations. ACO REACH, by contrast, accelerates innovation with expanded access, advanced payment models, and mandatory downside risk. For leaders in advanced primary care, the question isn’t whether to engage in value-based care, but which pathway positions your organization to thrive in a future defined by accountability, quality, and financial sustainability.

References

1. Centers for Medicare & Medicaid Services. Shared Savings Program (SSP) ACOs. U.S. Department of Health & Human Services. https://www.cms.gov/medicare/payment/fee-for-service-providers/shared-savings-program-ssp-acos

2. Centers for Medicare & Medicaid Services. About the Shared Savings Program (SSP) ACOs. U.S. Department of Health & Human Services. https://www.cms.gov/medicare/payment/fee-for-service-providers/shared-savings-program-ssp-acos/about

3. Centers for Medicare & Medicaid Services. (2024, January 29). CMS moves closer to accountable care goals with 2025 ACO initiatives [Fact sheet]. U.S. Department of Health & Human Services. https://www.cms.gov/newsroom/fact-sheets/cms-moves-closer-accountable-care-goals-2025-aco-initiatives

4. Centers for Medicare & Medicaid Services. ACO REACH model. U.S. Department of Health & Human Services. https://www.cms.gov/priorities/innovation/innovation-models/aco-reach

5. Centers for Medicare & Medicaid Services. Guidance & regulations: Shared Savings Program (SSP) ACOs. U.S. Department of Health & Human Services. https://www.cms.gov/medicare/payment/fee-for-service-providers/shared-savings-program-ssp-acos/guidance-regulations

6. Centers for Medicare & Medicaid Services. (2023, November). ACO REACH performance year 2024: Financial operations, capitation, and payment [PDF]. U.S. Department of Health & Human Services. https://www.cms.gov/files/document/aco-reach-py24-fin-ops-capitation-and-payment.pdf

7. Centers for Medicare & Medicaid Services. (2023, November 16). Accountable Care Organization (ACO) Realizing Equity, Access, and Community Health (REACH) Model [Fact sheet]. U.S. Department of Health & Human Services. https://www.cms.gov/newsroom/fact-sheets/accountable-care-organization-aco-realizing-equity-access-and-community-health-reach-model

8. Centers for Medicare & Medicaid Services. ACO REACH performance year 2024 model performance. U.S. Department of Health & Human Services. https://www.cms.gov/priorities/innovation/innovation-models/reach-py24-model-perf

9. Centers for Medicare & Medicaid Services. (2025, November 2). Calendar year (CY) 2026 Medicare physician fee schedule final rule (CMS-1832-F). U.S. Centers for Medicare & Medicaid Services. https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2026-medicare-physician-fee-schedule-final-rule-cms-1832-f

10. Centers for Medicare & Medicaid Services. (2024, July 10). ACO REACH model performance year 2026 update: Quick reference guide. U.S. Department of Health & Human Services. https://www.cms.gov/aco-reach-model-performance-year-2026-model-update-quick-reference