For most of the past decade, value-based care coverage has answered two questions: whether to join and what the contract should say. Those questions matter until the day the agreement is signed.

After signing, the management questions change. MGMA members increasingly bring us a practical one about downside risk: We have committed to a contract that can pay us or bill us. What has to be working before it starts, and how will we know during the year whether we are ahead or behind?

Two-sided risk is now mainstream in Medicare. CMS’ 2026 Fast Facts showed 76% of Medicare Shared Savings Program (MSSP) accountable care organizations (ACOs) in a two-sided track: BASIC Levels C, D, or E, or the ENHANCED track.¹

In performance year 2024, MSSP ACOs earned $4.1 billion in shared savings while saving Medicare $2.5 billion net, and three-quarters of participating ACOs earned a performance payment.²

Downside risk creates a different management problem. A first-year loss can expose failures that have little to do with the quality of care itself: an unreconciled patient list, no clear owner for a quality measure, no current financial forecast, or no funding plan for losses the practice has already agreed to accept.

Those failures are preventable, and they are far cheaper to address in the 90 days before the contract takes effect than to discover in the third quarter.