Locally based ACOs track results
By Cierra Noffke, posted Jan 14, 2026 on wilmingtonbiz.com
Two accountable care organizations (ACOs) are responsible for ensuring Medicare beneficiaries receive high-quality care in the region, and in 2024, one of them ranked first in the nation for quality care for the second year in a row.
Novant Health’s coastal region ACO, which covers New Hanover County, Brunswick County and Pender County, participates in the Medicare Shared Savings Program (MSSP) ACO model, which is the largest ACO model group, consisting of 450 ACOs. Novant’s coastal region ACO, called Physician Quality Partners, saved over $4 million in 2024 and received a $2.9 million payout. It also participates in the Enhanced MSSP track, meaning it takes full downside and upside financial risk for any savings lost.
First introduced with the Affordable Care Act in 2010, ACOs allow groups of health care providers to voluntarily coordinate care for Medicare beneficiaries, who can opt out of the ACO if they choose. The overall goal is to improve the quality of care while reducing costs, often by taking responsibility for both the total cost and the quality of care.
If an ACO meets quality performance and savings benchmarks set by the Centers for Medicare & Medicaid Services (CMS), it can receive shared savings payments as a reward for lowering Medicare costs.
“(ACOs) were started by Medicare as a way to pay physicians and health care organizations … differently than just fee-for-service,” said Jeffrey Warhaftig, primary care physician and medical director of Physician Quality Partners. “They’re trying to find ways to get us involved in taking risk for the total cost of care of patients and find a way through the accountable care organizations to pay us for the savings that we generate.”
The second ACO in the region, Wilmington Health’s ACO, now called Physicians Healthcare Collaborative, switched from MSSP to a new ACO model in 2023, after seeing gradually lower quality of care scores in the MSSP model. The new model, ACO REACH, which stands for Realizing Equity, Access and Community Health, is designed to be accessible to newer or smaller organizations with fewer beneficiaries, and it emphasizes health equity by rewarding participating ACOs for serving underserved population groups.
“There is a stronger emphasis on patient experience in the ACO REACH model than other models,” said Melissa Odom, Physicians Healthcare Collaborative’s chief operating officer, “and a tighter link between quality and financial accountability.
Additionally, ACO REACH requires participating organizations to assume full financial downside risk from the start, unlike the MSSP model, which allows organizations to assume more risk gradually.
As the REACH model compiles data on a different timeline than the MSSP model, 2024 data isn’t publicly available yet. But according to 2023 data, Physicians Healthcare Collaborative yielded net shared savings of $116 million in gross savings across participating health care organizations.
Because Physicians Healthcare Collaborative collaborates with various provider groups in Tennessee and Florida, it is the second-largest ACO group of its type out of the 103 existing ACO REACH groups, per CMS reporting. According to Odom, only 11,000 out of the 86,450 beneficiaries in the ACO live in the Wilmington area.
“When we invited partners to join PHC, with the shared goal of expanding high-quality care at a reasonable cost to more patients, some practices weren’t as far along in their journey for some of the quality measures,” said Odom. “Since the PHC reports quality measures at the ACO level, not the practice level, those scores can look deflated at the ACO level.”
Novant’s coastal region ACO, Physician Quality Partners, consists of Novant-employed physicians and includes 64 clinics in the coastal region, serving over 18,000 beneficiaries. Physician Quality Partners has consistently performed well, alongside Novant Health’s general ACO, which is also an MSSP model.
“We have seen a continued shift towards favoring those in the Medicare Shared Savings world in quality‑based programs, every year for the last 15 years, and I don’t see that changing,” said Warhaftig.
As the ACO REACH model is set to end by Dec. 31, the future of Wilmington Health’s ACO is uncertain. CMS launched a new ACO model, ACO LEAD (Long-term Enhanced ACO Design), intended to replace ACO REACH. ACO LEAD is explicitly focused on homebound patients and those with high needs and is a 10-year model, the longest performance period CMS has ever tested.
According to Odom, options for Wilmington Health’s ACO include potentially switching to ACO LEAD, as Wilmington Health’s ACO shares many of the same goals, or switching to an ACO MSSP Enhanced model, which is the same model Novant’s coastal region participates in.
“We have focused everything off the financial side of this,” said Warhaftig of Novant. “We’ve really done nothing in this program to reduce the cost of care other than practice quality (care) … Let’s just practice the best medicine we can, and the dollars will fall in line behind it, and obviously it has.”
Copyright © 2026
SAJ Media, LLC dba
Greater Wilmington Business Journal / WILMA
This story may be displayed, reformatted and printed for your personal, noncommercial use only and in
accordance with our Terms of Service located at https://wilmingtonbiz.jumppubdev.sps-project.com/useragreement.