The CMS has approved a waiver that will allow Massachusetts to overhaul its Medicaid program by putting its beneficiaries into accountable care organizations. Starting in July, the state will move its entire Medicaid population into an ACO. The state's current system is roughly half fee-for-service and half managed care. The waiver authorizes $52.4 billion over five years and generates $29.2 billion of federal revenue for the state. “This waiver is the first major overhaul of the MassHealth program in 20 years and includes critical reforms to promote coordinated care, hold providers accountable and offer expanded access for substance abuse disorder services,” Republican Gov. Charlie Baker said in a statement. Members will be placed in one of three ACOs based on which one their primary doctor chooses. Each primary-care provider can participate in only one ACO model and each model carries varying levels of risk. The waiver also allows the state to use federal funds to expand residential rehabilitation service programs and fund care-coordination and recovery services for beneficiaries with substance abuse disorders. The waiver continues to funnel federal funds into the state's hospital pool for uninsured individuals. The CMS had increasingly questioned the need of such pools following Medicaid expansion under the Affordable Care Act. Over the next five years, Massachusetts will receive $4.8 billion to pay for uncompensated care by safety net providers.