Your Questions Answered

Find out how Kenji MSO is transforming the way healthcare for traditional Medicare beneficiaries and dual-eligibles is accessed, financed, and delivered.

What is Kenji MSO?

Kenji MSO is a physician-aligned management services organization that builds and supports physician-owned mutuals through an OpCo/DocCo joint venture model. Together, the MSO (OpCo) and the physician-owned Mutual (DocCo) are designed to thrive under total cost capitation—empowering physician-led enterprises to deliver superior population health outcomes, preserve clinical independence, and maximize shared value for physicians and their communities.

This structure allows physicians to maintain full clinical autonomy and financial control while providing whole-person care. By pooling exposure across a broader base, physicians are shielded from downside losses and positioned to capture substantial savings against CMS benchmarks.

Why are physicians joining Kenji now?

Kenji provides management infrastructure for a physician-led entity with total-cost accountability and is expanding into a multi-payer advanced Alternative Payment Model (APM) physician Mutual. The program places patients at the center while enabling physicians to guide care delivery and all surplus savings distribution.

Key benefits:

  • Full authority over Part A and Part B savings

  • Insulation from financial downside

  • Stronger negotiation and purchasing power

  • High-impact programs like Chronic Care Management

  • Increased practice income

  • Seamless multi-specialty network collaboration

  • Additional investment opportunities

Kenji's team estimates potential Medicare Part A total savings of 30% in a typical physician's patient panel.

What are physician leaders saying about Kenji?

‘I have examined many, many innovative payment models in my numerous leadership roles over the past decades. None in my opinion has ever been more promising for physicians—and their patients—than the Kenji Reach concept.

 It not only puts physicians in total control of clinical care design and oversight, but for the first time also in real financial control—and not just over Medicare Part B. It covers ACO management of Medicare Parts A and B today and will likely expand to other insurance types over time. Savvy physicians will understand that this model is the best opportunity ever to leverage high quality care for patients without regulatory or insurance red tape, and likewise to be fully and fairly rewarded for doing so.’ 

-  Dr. Jack Lewin, one of Modern Healthcare’s 100 Most Influential People in Healthcare, Administrator of the Hawaii State Health Planning and Development Agency, past Chairman of the National Coalition on Health Care. Formerly President & CEO, Cardiovascular Research Foundation; CEO, American College of Cardiology; and CEO, California Medical Association.

Who may participate in Kenji?

All physicians treating Medicare beneficiaries may join the Mutual/MSO joint venture. Participants are committed to high-quality, cost-effective, connected, data-driven care that engages patients and families, and supports the Quintuple Aim: improving population health, promoting clinician well-being, advancing health equity, enhancing the patient experience, and reducing costs.

Note: Physicians in other CMS APMs, employed by hospitals/insurers, or bound by restrictive covenants should contact Kenji MSO to review participation options.

Who owns Kenji?

Owned and governed entirely by participating physicians—no outside investors.

When does Kenji expect to begin operations?

Kenji MSO plans to start its first performance year on January 1, 2027 (PY2027).

What about physicians in another program?

Any physician currently enrolled in another ACO or overlapping program can visit KenjiREACH.com to sign a non-binding letter of interest and enroll today. By September, you will need to disenroll from the overlapping program. Overlapping programs may include, but are not limited to: Primary Care First, Independence at Home, Kidney Care Choices, Vermont All-Payer Model, Maryland Primary Care Program, and the Medicare Shared Savings Program.

What is the commitment to evaluate the program?

The 12-month evaluation is simple. Sign a non-binding LOI—there’s no commitment, enrollment is free, no investment is required, it’s non-exclusive, and there’s no minimum practice size. Encourage peers and colleagues to join: program size matters for actuarial stability, increases bargaining power, and strengthens protection against downside losses. The more physicians and advanced practice providers participate, the more effective the evaluation and the stronger the program.  

How are participant providers paid?

Each month, CMS will pay Kenji MSO 1/12th of 3.4% of the total Part B benchmark per aligned beneficiary for 2027 (adjusted by CMS factors). Kenji passes these monthly amounts directly to Participant Providers.

After PY2027 ends, CMS will issue a partial settle-up—approximately half based on the first six months’ performance—expected in Q1 2028. Once Kenji receives this payment for 2027 savings, it will distribute the reconciled amount to physicians, net of pre-investment costs, MSO fees for back-office services, and any other direct expenses approved by the Mutual’s physician-governed Board.

When will the realized savings be distributed?

 The exact dates are not yet available from CMS. Savings related to the first half of 2027 will be distributed in the First Quarter of 2028. A ‘Final Reconciliation Payment’ will be distributed early in the Third Quarter of 2028.

What care is eligible for savings?

All Part A and Part B total cost of care under global payment arrangements provided to aligned beneficiaries qualifies for savings.

How does Kenji expect to achieve savings?

Delivering high-quality care remains Kenji’s top priority. After reviewing claims data across a broad range of providers, Kenji’s team has identified multiple opportunities to improve outcomes while lowering costs. Savings are expected to be achieved through:

  • Shifting care to clinically appropriate, lower-cost settings

  • Strengthening primary care, prevention, and chronic disease management to reduce avoidable hospitalizations

  • Building a clinically and financially integrated care network to enhance collaboration and coordination

  • Connecting EHRs and EMRs across providers to enable dynamic, cross-continuum transparency and reduce duplication

  • Addressing social determinants of health that drive unnecessary utilization and poor outcomes

What will the Mutual’s network include?

Kenji is developing a comprehensive and adaptive network designed to improve health outcomes and reduce costs by integrating clinical care with services that address social determinants of health. The network will evolve over time to meet the changing needs of beneficiaries and is expected to include:

  • Health systems, home care and hospice providers, nursing facilities, rehabilitation centers, and urgent care clinics

  • Non-traditional partners such as ride-sharing services, real estate developers, and community-based organizations

  • A connected digital infrastructure that links EHRs and EMRs across providers, enabling real-time transparency and coordination across the full continuum of care

This inclusive approach ensures care is not only clinically effective, but also accessible, efficient, and responsive to the broader factors that shape health.

What are the criteria for beneficiary eligibility?

To be eligible a beneficiary must:

  • Have both Medicare Parts A and B

  • Have Medicare as their primary payer and not be enrolled in a Medicare Advantage Plan, Medicare Cost Plan, or PACE organization

  • Be a U.S. resident living in a county within the Mutual's service area

What payment model will the Mutual operate under, and how does this work?

The Mutual will start with Global Capitation and gradually expand similar arrangements to other payers. Under this model, the Mutual assumes full financial responsibility for the total cost of care and can retain 100% of any savings—or absorb losses—relative to CMS or payer-adjusted benchmarks.

Participating physicians and advanced practice providers continue to submit claims to CMS and other payers. These claims will be zero-paid because participating providers are already prospectively paid.

How are preferred providers paid?

Preferred providers submit claims and are paid as they do today. Those with payment adjustment agreements with the Mutual will receive revised payments based on terms negotiated through downstream contracts.

How does Kenji limit Participating Providers’ downside exposure?

Kenji’s model ensures that physicians have no direct downside exposure to catastrophic patient costs.

Here’s how this protection works:

  • CMS Pays All Claims: CMS processes and pays every claim (net of Part B prospective payments) as incurred, including high-cost outlier claims.

  • No “Specific” Exposure: Since CMS pays all claims, individual outlier costs are automatically covered. At settlement, these costs are deducted from the total savings pool before distribution, so providers never bear direct responsibility for them.

  • Shared Surplus: After settlement, the remaining savings—after accounting for all costs including outliers—are distributed equitably among participating providers.

  • Aggregate Protection: In the unlikely event that aggregate claims exceed the benchmark, the ~3–4% reserve fund covers the shortfall. If that reserve were ever fully depleted, the Mutual would discontinue the program. This scenario is highly improbable.

The result is that providers are protected on all sides—individual outliers are absorbed through CMS and settlement, and aggregate overages are backstopped by the reserve—ensuring that physicians only participate in upside savings, not downside losses.

How Will Kenji MSO Handle Back-Office Functions?

Kenji MSO manages all core administrative and operational functions to support participating physicians and ensure the success of the Mutual. These include:

  • Establishing and managing the clinical network

  • Facilitating physician governance and forming an Advisory Board

  • Overseeing cash flow, financial operations, and exposure management

  • Negotiating with payers and managing contracts and vendor relationships

  • Supporting practice transformation and care coordination training

  • Providing infrastructure, data analytics, reporting, and communications

Kenji MSO operates on a fee structure equal to 3.5% of benchmark payments, ensuring cost-effective support while maximizing value for participating providers

What reporting support will Kenji provide?

Kenji’s will provide Mutual Physicians with reporting support based on CMS/Payer requirements. The final, specific reporting requirements to be determined.

What are examples of the ‘New Income Sources’ mentioned in the Kenji materials?

Kenji will actively explore and vet opportunities for Participant Providers to grow their income beyond traditional clinical reimbursement. Early examples include investments in mixed-use real estate—such as senior living communities, integrated care hubs, and urgent care centers—that align with the Mutual’s mission and generate sustainable, long-term returns.

What if I have other questions?

If you have other questions, please contact Geoff Teed by calling (203) 520-9471 or by sending an email to kenji@kenjireach.com.