In February 2022, the Centers for Medicare & Medicaid Services (CMS) announced ACO REACH, extending the Direct Contracting model to better align with CMS’ strategic initiatives. In this new model, CMS introduced many significant changes to achieve the goals, after which REACH is named – Realizing Equity, Access, and Community Health. Specifically, CMS implemented five design elements to promote health equity and address healthcare disparities for underserved communities.
This article will focus on the Health Equity Benchmark Adjustment (HEBA) policy among those five elements. The primary motivation for HEBA, as stated in the CMMI’s health equity webinar, is as follows: researchers have found that physicians in underserved communities are less likely to participate in ACO than others. Here, underserved communities refer to areas where a higher percentage of the population is 1) black, 2) living in poverty, 3) uninsured, 4) disabled, or 5) has less than high school education. Thus, as CMS states, HEBA aims to increase ACO participation of doctors in underserved areas.
In detail, HEBA works by adjusting benchmark rates for aligned beneficiaries in an ACO REACH, proposing the use of the Area Deprivation Index (ADI), which was developed by the Health Resources & Services Administration (HRSA) over three decades ago.1HEBA combines a beneficiary’s ADI and Dual Medicaid Status to determine the adjustment amount. If the score is high, HEBA adds $30 per beneficiary per month (PBPM) to the benchmark; otherwise, it deducts $6 PBPM. Here, we strive to take a deeper look at the ADI measure.