Medicare ACOs are expanding in 2026, bringing coordinated care to more beneficiaries than ever before. A record 14.3 million people with Medicare are now receiving care through Accountable Care Organizations, reflecting a continued shift toward managing costs while improving care coordination and outcomes. This expansion signals meaningful changes in how Medicare works with doctors, hospitals, and healthcare systems to deliver your care.
More Doctors Coordinating Your Care
The Medicare Shared Savings Program welcomed 134 applications for 2026, including 72 brand new ACOs and 62 organizations that chose to renew or return to the program. This brings the total number of participating ACOs to 511, up from 476 in 2025. What makes this particularly noteworthy is that these organizations now coordinate care for 12.6 million people with Traditional Medicare, representing a 12.3% jump from the previous year and the highest enrollment the program has ever seen.
More than 700,000 healthcare providers and organizations now work within these ACO structures. This represents a real change in how care is delivered. It represents doctors, hospitals, specialists, and other healthcare professionals who’ve committed to working together differently. Instead of operating in silos where your primary care doctor might not know what your cardiologist recommended, these providers share information and coordinate your treatment plans. The expansion suggests that more healthcare organizations see value in this collaborative approach, even as it requires significant changes to how they’ve traditionally operated.
Billions in Savings Through Better Coordination
The financial impact of ACOs extends well beyond theoretical cost management. During Performance Year 2024, the most recent period with complete data, Shared Savings Program ACOs earned $4.1 billion in shared savings while generating $2.5 billion in net savings for Medicare. You might wonder how organizations can earn money while simultaneously saving the program money. The answer lies in how the incentive structure works.
When your ACO delivers high-quality care while spending healthcare dollars more efficiently than expected, it shares in a portion of those savings. This creates a financial incentive for your healthcare team to focus on preventive care, catch problems early, and avoid unnecessary emergency room visits or duplicate tests. You benefit because coordinated care typically means fewer gaps in your treatment, better communication between specialists, and reduced out-of-pocket costs when you avoid expensive emergency care or redundant procedures.
The savings mechanisms work through several channels. Your ACO might help you manage chronic conditions more effectively, reducing hospital readmissions. They might ensure you’re getting recommended preventive screenings that catch problems before they become expensive to treat. They could coordinate your medications better, eliminating dangerous interactions or unnecessary duplications. Each of these improvements contributes to the overall cost reduction while potentially improving your health outcomes.
Understanding Different ACO Program Options
You’ll encounter several distinct ACO models within Medicare, each designed with specific goals and patient populations in mind. The Medicare Shared Savings Program represents the largest initiative, but it’s far from the only option available to healthcare organizations wanting to take on accountability for cost and quality.
The ACO REACH Model involves 74 ACOs with nearly 126,000 healthcare providers serving an estimated 1.7 million people with Traditional Medicare. This model recently updated its financial methodology to ensure future cost savings, with projections showing decreased net spending for 2026. What sets REACH apart is its inclusion of 614 Federally Qualified Health Centers, Rural Health Clinics, and Critical Access Hospitals. If you live in a rural area or receive care at a community health center, you’re more likely to encounter this model than others.
The Kidney Care Choices Model takes a specialized approach, focusing specifically on people with chronic kidney disease and End-Stage Renal Disease. With 74 Kidney Contracting Entities serving 237,000 beneficiaries through 7,534 participating providers, this program addresses the unique needs of kidney disease patients. Managing kidney disease requires intensive coordination between nephrologists, dialysis centers, surgeons for transplant evaluations, and primary care providers. The KCC Model creates accountability structures specifically designed for this complex patient journey.
The ACO PC Flex Model represents something different. It’s a payment innovation specifically for primary care within the Shared Savings Program framework. The 23 participating ACOs serve about 360,000 people, testing whether enhanced primary care payments lead to better outcomes and cost management. If you’re in one of these ACOs, your primary care doctor’s practice receives different payment structures designed to support more comprehensive, preventive care.
Providers Held Accountable for Spending
One of the most significant trends in the 2026 data is that 82.8% of Shared Savings Program ACOs now participate in Level E of the BASIC track or the ENHANCED track. This represents the highest percentage since the program started in 2012. Why does this matter to you? These tracks involve two-sided risk, meaning your ACO can share in savings but also faces financial penalties if spending increases without quality improvements.
This shift toward risk-bearing arrangements reflects growing confidence among healthcare organizations that they can actually manage costs while maintaining or improving quality. You’re essentially working with providers who’ve put their own money on the line, betting they can deliver better care more efficiently. This creates powerful incentives for them to focus on keeping you healthy rather than just treating you when you’re sick.
The move toward Advanced Alternative Payment Models under the Quality Payment Program also affects your physicians directly. Doctors participating in these models receive different payment adjustments and avoid some of the administrative reporting requirements that apply to traditional fee-for-service medicine. This can free up time they’d otherwise spend on paperwork, potentially giving them more capacity to focus on patient care.
Recent changes finalized in the 2026 Physician Fee Schedule aim to increase participation in two-sided risk arrangements even further. The Centers for Medicare and Medicaid Services believes that accountability for both savings and losses creates the strongest incentives for genuine delivery system reform. You’ll likely see more ACOs moving into these risk-bearing tracks in coming years.
Future Changes Coming with LEAD
Looking ahead to 2027, you’ll see the introduction of the Long-term Enhanced ACO Design Model, known as LEAD. This new initiative will replace the ACO REACH Model and aims to attract a broader mix of healthcare providers, including smaller independent practices, rural-based organizations, and those serving specialized patient populations.
LEAD places particular emphasis on coordinating care for high-needs patients. If you’re dually eligible for both Medicare and Medicaid, or if you’re homebound or home-limited, this model specifically targets improving your care coordination. These populations often face the greatest challenges with fragmented care because they interact with multiple providers and social service agencies. LEAD’s structure attempts to create better integration across these different systems.
The transition from ACO REACH to LEAD reflects ongoing learning about what works in accountable care arrangements. Earlier models provided valuable data about how different payment structures and accountability mechanisms affect provider behavior and patient outcomes. LEAD incorporates these lessons while trying to make participation feasible for a wider range of organizations. If your current providers participate in ACO REACH, you’ll want to pay attention to how they transition to LEAD and what that might mean for your care experience.
Conclusion
The expansion of Medicare ACOs to cover 14.3 million beneficiaries represents more than just administrative growth. It signals a fundamental shift in how Medicare approaches healthcare delivery, moving away from paying for individual services toward holding organizations accountable for your overall health outcomes and the total cost of your care. The financial results suggest this approach can generate substantial savings while potentially improving care coordination and quality.
As these models continue evolving, you’ll see more healthcare providers joining ACOs and more organizations taking on financial risk for the care they deliver. Whether these changes ultimately improve your personal healthcare experience will depend on how well your specific providers implement the principles of coordinated, preventive, whole-person care that ACOs are designed to promote. For more information about Medicare, please call 866-633-4427 to speak with a Senior Healthcare Solutions Medicare expert.
