Demystifying the Retrospective Trend Adjustment in Direct Contracting and ACO REACH

Few aspects of CMS’s innovative Global and Professional Direct Contracting (GPDC) model have been the source of as much uncertainty and controversy as the retrospective trend adjustment. In this whitepaper, we pull back the curtains on what the retrospective trend adjustment is and how it’s calculated. We discuss why it exists, as well as the implications for GPDC participants’ benchmarks. We finish the discussion by shedding light on how recently released information by CMS may provide an indicator of what to expect for the rest of 2022 and heading into 2023.