Accountable care organizations (ACOs) operating under the Medicare Shared Savings Program (MSSP) and the ACO Realizing Equity, Access, and Community Health (REACH) model are financially responsible for the total Medicare Parts A and B fee-for-service expenditures of their assigned beneficiaries. This includes spending generated by providers and suppliers outside the ACO’s network and operational control. With 76% of MSSP ACOs bearing two-sided financial risk as of performance year 2026, fraud, waste, and abuse by non-participant providers can erode shared savings and amplify shared losses.

Recent episodes demonstrate the scale of this exposure. The intermittent urinary catheter billing fraud of 2023 required emergency rulemaking under billing provisions categorized as “significant, anomalous, and highly suspect” (SAHS). In another example, Medicare spending on skin substitutes escalated to approximately $10 billion in 2024, up from $1.6 billion in 2022. Additional rulemaking in March 2026 addressed ongoing SAHS billing issues affecting ACO programs in 2025, including the removal of 90% of skin substitute expenditures for REACH ACOs.

Despite receiving comprehensive claims data through a specific file format and API, many ACOs have not yet built the analytical infrastructure needed to detect these anomalies systematically, leaving them exposed to financial impacts until it is too late to act. The Centers for Medicare and Medicaid Services (CMS) has signaled a clear expectation that this gap be addressed. This paper examines the financial exposure, the detection gap, the CMS-award-winning methodology, and the considerations ACOs may wish to evaluate when investing in program integrity efforts.

• Key discussion points include the following:
• Financial exposure
• The CMS “Crushing Fraud” chili cookoff
• Methodological framework
• Validation and enforcement alignment
• Application to ACO operations
• Considerations for ACOs