CMS Moves Closer to Accountable Care Goals with 2025 ACO Initiatives

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Posted By: HHS/ONC/CMS Communications January 22, 2025

CMS has made substantial progress on its goal for all people with Traditional Medicare to be in a care relationship with accountability for quality and total cost of care by 2030. As of January 2025, 53.4% of people with Traditional (fee-for-service) Medicare are in an accountable care relationship with a provider. This represents more than 14.8 million people and marks a 4.3 percentage point increase from January 2024, the largest annual increase since CMS began tracking accountable care relationships. This includes patients whose providers are in Accountable Care Organizations (ACOs), including the Medicare Shared Savings Program ACOs and entities participating in Center for Medicare and Medicaid Innovation (Innovation Center) accountable care models, as well as other Innovation Center models focused on total cost of care, advanced primary care, and specialty care.

ACOs are groups of doctors, hospitals, and other health care professionals that work together to give patients high-quality, coordinated service and health care, improve health outcomes, and manage costs.

Steadily increased participation in accountable care arrangements demonstrates that changes CMS has made over the last few years through rulemaking and Innovation Center models are connecting people to longitudinal care relationships with providers. In the calendar year (CY) 2023, CY2024, and CY2025 Physician Fee Schedule final rules, CMS created and then refined the new Advanced Investment Payments (AIP) for new, low-revenue ACOs inexperienced with performance-based risk Medicare ACO initiatives (permanently scaling lessons learned from an Innovation Center model).

For the 2025 performance year, CMS approved 228 applications for the Medicare Shared Savings Program, including 55 new ACOs and 173 renewing or reentering ACOs, the largest annual number of renewals in the 12-year history of the program. This brings the total number of ACOs participating in the Shared Savings Program for Performance Year 2025 to 476. CMS has also seen a 16% increase in the number of Federally Qualified Health Centers, Rural Health Clinics, and Critical Access Hospitals participating in the Shared Savings Program from last year.

Additionally, 103 ACOs are continuing their participation in Innovation Center’s ACO Realizing Equity, Access, and Community Health (ACO REACH) Model, and 78 Kidney Contracting Entities and 15 CMS Kidney Care First Practices are continuing their participation in the Kidney Care Choices (KCC) Model. The Innovation Center also launched the ACO Primary Care Flex (ACO PC Flex) Model, which includes 24 ACOs participating jointly in the Shared Savings Program. The ACO PC Flex model continues CMS’ support of primary care as the foundation of accountable care and tests the impact of increased investment with ACOs in the Shared Savings Program.

CMS Accountable Care Organization Initiatives — Participation Highlights

Participation numbers for CMS ACO initiatives for 2025:

  • The Shared Savings Program has 476 ACOs with 655,725 health care providers and organizations providing care to more than 11.2 million people with Traditional Medicare, a 3.7% increase in individuals from the previous year. Shared Savings Program ACOs deliver care to people with Traditional Medicare in 10,455 Federally Qualified Health Centers, Rural Health Clinics, and Critical Access Hospitals.
  • ACOs receiving advanced investment payments are new, low-revenue Shared Savings Program ACOs inexperienced with performance-based risk Medicare ACO initiatives. AIP provides entities in rural and underserved areas upfront funding to join together to form ACOs to participate in the Shared Savings Program, and support care coordination and quality improvement for underserved beneficiaries. As of 2025, there are 28 ACOs receiving advance investment payments (an increase of 47% from last year), with half of beneficiaries assigned to these ACOs residing in health professional shortage areas or medically underserved areas. The AIP option represents a successful scaling of lessons learned from the Innovation Center’s Advanced Investment Model (AIM) into a permanent feature of the Shared Savings Program.
  • The ACO REACH Model has 103 ACOs with 161,765 health care providers and organizations providing care to an estimated 2.5 million people with Traditional Medicare. This model has 928 Federally Qualified Health Centers, Rural Health Clinics, and Critical Access Hospitals participating in 2025.
  • The KCC Model includes 78 Kidney Contracting Entities (KCEs) and 15 CMS Kidney Care First (KCF) Practices, which are accountable for the quality and care of their aligned people with Traditional Medicare. The KCC Model has 8,430 participating health care providers and organizations, serving 240,000 people with Traditional Medicare who have chronic kidney disease and End-Stage Renal Disease in 2025.
  • NEW FOR 2025: The ACO PC Flex Model includes 24 ACOs serving 349,000 people with Traditional Medicare. This new model, which began on January 1, tests a new payment model for primary care within the Shared Savings Program. ACOs jointly participate in the model and the Shared Savings Program.

More Information

Shared Savings Program

ACO REACH Model

KCC Model

ACO PC Flex Model