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Harnessing the Power of Integrated Capitation & Analytics for ACO REACH Organizations

BLOG | March 7, 2016

It wasn’t long ago that many clinicians were averse to the thought of capitated payments. In a 2003 paper published in Health Services Research, authors highlighted concerns that capitation “creates potential conflicts of interest between physicians’ incomes and patients’ expectations for treatment, especially among the chronically ill.” Experts worried, the article continued, that some providers may avoid patients who are likely to incur high treatment costs.


Today, the Centers for Medicare and Medicare Services (CMS) Realizing Equity, Access, and Community Health (ACO REACH) program is bringing capitation back to the forefront of our healthcare discussions, but with some key differences. Rather than simply focusing on minimizing total costs, accountable care organizations (ACOs) must first meet key quality metrics that ensure patients – even those with costly chronic conditions or high-cost treatments – will get the care they deserve. Additionally, organizations now have access to extensive data that can help manage risk efficiently and effectively.


When administered effectively, capitated payment models have many benefits for healthcare organizations – including both payers and providers.

  • Steady and predictable revenue streams. Capitation offer a fixed per-member-per-month (PMPM) payment to providers
  • Better patient outcomes. When providers’ income is not linked solely to the number of procedures they provide (as it is in fee-for-service models), they can focus on preventive care and other steps to improve care quality and patient outcomes
  • Adjustments for higher-risk patients. Software tools help organizations accurately and consistently capture patient risk and health conditions that will impact risk scores, maximizing reimbursement to care for even the sickest patients.


There are several key components to success in ACO REACH and other capitated models today, but one of the most important is building an integrated technology stack with the capability to seamlessly share data.

A Single Data Source of Truth
Cedar Gate’s proprietary data management system ingests information from any source. We bring it together into a shared data lake to create a single source of truth across our entire platform of value-based care technology solutions. It has:

  • 19 highly accurate predictive models to identify patient and member risks, preventive care opportunities, and opportunities to improve operational efficiency
  • Insights from multiple external data sources, including social determinants of health (SDoH)
  • Over 40 data types to ensure you never miss care gaps that could improve quality or lower costs
  • Shareable dashboards so providers and stakeholders can see data for themselves
  • Tools to gauge performance and effectiveness of care management programs and point solutions 

Advanced Analytics
After ingesting data from multiple sources, organizations need an advanced analytics solution that can dig deeper into the data and provide both predictive and prescriptive insights, such as:

  • Predict chronic conditions before they manifest and become costly to manage and control
  • Incorporate health disparity and deprivation data that could impact utilization and treatment adherence 
  • Compare claims and EHR data to ensure all gaps in care are identified 
  • Automatically share cost, quality, and performance insights with care teams and providers in an easy to consume way
  • Measure the effectiveness of interventions, and their impact on cost and quality

Fully Integrated Capitation Payment Technology
A defining feature of capitation alternative payment models is their complex contract and reimbursement structures. Too many organizations rely on legacy software that lacks these advanced capabilities, or simply use manual tracking methods that are both time-consuming and error-prone. Cedar Gate’s Capitation Adjudication software:

  • Automates processes in capitated models for any ACO organization
  • Reconciles payments and administer sub-capitation or bundles arrangements with network providers
  • Has the backing of an experienced team of payment specialists who stay apprised of ever-shifting CMS requirements
  • Includes regular updates with the latest tools to manage risk and maximize profitability


Cedar Gate offers the most comprehensive suite of composable solutions for ACO REACH organizations. With fully integrated analytics and capitation software, ACOs can more effectively manage risk and seamlessly administer complex payment arrangements. Start building your customizable solution today.

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