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In December of 2018, the Trump Administration overhauled the largest value-based payment program in fee-for-service Medicare—the Medicare Shared Savings Program (“Shared Savings Program” for short) for “Accountable Care Organizations” or ACOs. ACOs are groups of health care providers that agree to be held accountable for the quality, cost, and experience of care for a population of Medicare beneficiaries. In addition to the Shared Savings Program, CMS administers smaller ACO models through the Center for Medicare and Medicaid Innovation; these models test new approaches to structuring incentives for ACOs.
The Shared Savings Program had been operating for over six years when we launched our redesign. Given all the best practices and learnings that emerged from over half a decade of experience, it was time to strengthen the incentives in the program and ensure real accountability while also providing more flexibility for ACOs to innovate.