On October 28, CMS announced that Rhode Island and Downstate New York were accepted to participate into Cohort 3 of the States Advancing All-Payer Health Equity Approaches and Development (AHEAD) model. Cohort 3’s first Performance Year is 2027. Downstate NY will consist of the following five counties: Bronx, Kings, Queens, Richmond, and Westchester.

AHEAD is a voluntary total cost of care model whereby CMS encourages a state-level, multi-sector approach to care that both holds states accountable to state or region-specific Medicare and all-payer cost growth targets while increasing investments in primary care.

We recently shared five key takeaways for hospitals and providers in the states that had been awarded at that time through Cohorts 1 and 2. Below are additional key updates and considerations.

1. Hospitals Should Prepare a Global Budget Financial Model to Assess Upside or Downside for Both Medicaid and Medicare
   As hospital participation is voluntary, hospitals should evaluate the financial implication of transitioning to a global budget. Version 2.0 of the Medicare FFS global budget methodology was released in July 2024, and Version 3.0 of the hospital global budget financial specifications is expected to be released in Q1 2025. New York and Rhode Island must submit a Medicaid global budget methodology to CMS by December 2025 (states in Cohorts 1 and 2 must submit by December 2024). Hospitals should monitor the development of this methodology and any changes from the Medicare FFS model.
2. Hospitals Should Continue to Consider How To Leverage Global Budget Required Capabilities and Infrastructure to Succeed in Broader Risk Arrangements
   Leadership should evaluate current state capabilities and what new capabilities and infrastructure will be required for success. Hospitals should strongly consider developing IPA/CIN infrastructure aligned around a network configuration strategy that focuses on coordinating primary care with an ambulatory network of specialists, both for employed and voluntary providers in the communities that hospitals serve. This will work to change site of care access from the hospital into the community. For hospitals in Downstate NY, the NYS 1115 Medicaid Waiver outlines key transformation areas, including data analytics, care coordination and management, physician network and engagement, and service line rationalization based on community need. These activities mirror what is needed to develop and operate an IPA/CIN that can drive success in value based payment arrangements with payers, as well as global budget and Medicare shared savings ACO models.
3. Hospitals Should Continue to Consider Overlap Opportunities with Other CMS VBP Models
   In addition to models such as MSSP ACO that we have outlined previously to grow attribution, all locales approved for AHEAD are located in a Core Based Statistical Area (CBSA) selected by CMS for the Transforming Episode Accountability Model (TEAM). TEAM is a mandatory episode-based alternative payment model for five selected procedures (lower extremity joint replacement, surgical hip femur fracture treatment, spinal fusion, coronary artery bypass graft, and major bowel procedure) in which providers are incentivized to lower total cost of care and improve quality outcomes, including hospital readmission. TEAM is a Medicare model and runs from 2026 – 2030. Hospitals who participate in AHEAD will still be required to participate in TEAM, although the methodology for reconciling between the two programs is undisclosed.
4. The Application Window for AHEAD Has Closed
   No additional states or substate regions are expected to be accepted into AHEAD at this time, however New York can expand the sub-state region before 2027 with CMS approval.

COPE Health Solutions’ team of experts can help your organization position itself for success in the AHEAD model as well as other value-based care programs through health plans, CMS and state-based 1115 Waiver amendments. This includes the ability to financially model AHEAD Medicare FFS and Medicaid base revenue and scenario based assumptions for performance on and impacts of the various adjustments.

Contact info@copehealthsolutions.com to learn how we can help your organization if it is considering on applying for the AHEAD program. In addition, visit our AHEAD model webpage for additional information on the AHEAD model.