FAQs by Topic:
Additional LEAD technical FAQs (PDF) are also available.
Model Purpose
How will the LEAD Model make Americans healthy again?
The LEAD Model will make Americans healthy again by strengthening primary care through prospective, capitated payments that support preventive and proactive care and by holding ACOs accountable for clinically meaningful quality measures focused on prevention and chronic disease management. As part of LEAD, ACOs would also have the flexibility and support needed to design prevention initiatives that address the needs of the population they serve (e.g., chronic disease management, falls prevention). In addition, LEAD will include Benefit Enhancements (or Medicare waivers) and Beneficiary Engagement Incentives that promote and support healthy living activities, such as healthy eating, physical activity, and stress management.
How will LEAD support rural health care providers?
LEAD includes several features intended to reduce barriers to accountable care participation for rural providers and to support care delivery in rural communities. LEAD will support rural health care providers and ACOs serving rural communities by:
- Providing additional payment support through an unreconciled add-on payment to help participating ACOs build the infrastructure needed to succeed in accountable care.
- Offering lower beneficiary alignment minimums for ACOs with providers that are new to Medicare ACO participation, including rural health care providers that may have smaller patient panels.
- Supporting care for dually eligible beneficiaries through a Medicaid integration component intended to improve coordination across Medicare and Medicaid services, which may benefit rural communities with limited provider capacity and complex care needs.
How will LEAD support providers who serve High Needs beneficiaries?
LEAD will support care for High Needs beneficiaries through a model-wide approach rather than a separate High Needs ACO type. Under LEAD, High Needs policies apply to beneficiaries who meet the High Needs criteria across all participating ACOs.
This approach intends to:
- Support more accurate payment and accountability for ACOs that care for High Needs beneficiaries, including through tailored benchmarking and risk adjustment policies.
- Allow complex-care organizations to serve a broader Medicare fee-for-service population within LEAD, rather than limiting participation only to beneficiaries who meet High Needs criteria.
- Recognize the smaller patient panels typical of complex-care organizations by offering lower beneficiary alignment minimums for ACOs whose aligned population includes a high proportion of High Needs or ESRD beneficiaries.
- Support better coordination for dually eligible beneficiaries through a Medicare-Medicaid integration component in selected states.
Together, these policies aim to strengthen participation by organizations serving complex populations while improving care coordination, accountability, and financial predictability for High Needs beneficiaries across the model.
How is LEAD supporting Medicare-Medicaid integration for ACOs?
LEAD designed to support the integration of Medicare and Medicaid services for patients receiving Medicare benefits through Original Medicare. The goal is to create incentives for Medicare and Medicaid health care providers to coordinate care and improve outcomes for dually eligible beneficiaries in Original Medicare. During an initial planning phase from March 2026 through December 2027, CMS will identify two states that are interested in partnering to develop a framework for ACO-Medicaid partnership arrangements. This framework will help define how ACOs and Medicaid organizations can work together to share data and coordinate care to improve outcomes, including preventing avoidable hospitalizations and helping patients remain engaged in their communities. Pending successful completion of the planning period, ACOs in the selected states would have the opportunity to enter partnership arrangements with Medicaid organizations.
Model Features
What are the key features of the LEAD benchmarking methodology?
LEAD’s benchmarking methodology builds on ACO REACH and the MSSP to create a pathway towards sustainable, long-term benchmarks and savings for different types of ACOs.
- Long-Term Benchmark Stability: LEAD offers a 10-year performance period with no traditional rebasing, giving ACOs time to invest in care transformation and see returns over the long term.
- Predictable, Accurate Annual Updates: Benchmarks will be updated using a blend of a prospective trend factor plus observed national and regional spending. Guardrails will be applied to the prospective trend factor to support accuracy and mitigate large forecasting misses. This approach aims to provide more predictable year-to-year benchmark growth while creating an opportunity for efficient ACOs to “beat” the trend and generate durable savings.
- A Realistic Starting Point for Higher-Spending Organizations: ACOs whose aligned beneficiaries have higher historical Medicare costs compared to other beneficiaries in the same geographic region are not required to immediately be measured against a benchmark that incorporates regional spending. Higher-spending ACOs will have a benchmark based purely on their aligned beneficiaries’ own historical spending, plus additional payment support, creating a viable pathway to improve efficiency over time.
- Prior Performance: ACOs whose aligned beneficiaries have lower historical spending than other beneficiaries in their region will be eligible for a positive regional efficiency adjustment. ACOs that have already generated savings in ACO REACH or MSSP may receive a regional efficiency adjustment or a prior savings adjustment, whichever is higher. Both of these adjustments will reflect the ACO’s own unique risk profiles.
- Transition toward a regional rate book: Over time, as ACO spending levels converge within a region, LEAD is designed to move toward a more standardized regional rate book, reducing reliance on historical spending and promoting greater equity across participants.
Together, these features are intended to create more predictable, durable, and equitable benchmarks that reward long-term cost reduction and support sustained participation.
What is the CMS Administered Risk Arrangement (CARA) initiative, how does it support specialty integration in LEAD, and when will it be available?
CARA is a voluntary initiative that will be tested in LEAD to help ACOs engage in two-sided risk arrangements to develop stronger financial and clinical relationships with Preferred Providers, including specialists and other downstream provider organizations.
Through CARA, CMS will support episode-based risk arrangements (EBRAs) between ACOs and Preferred Providers by:
- Sharing episode-level data with ACOs and participating Preferred Providers.
- Providing ACOs with the ability to export episode design information from 4i to support negotiations with Preferred Providers.
- Allowing configurable episode design so arrangements can be tailored to different clinical areas and provider relationships.
- Providing reconciliation data to ACOs and Preferred Providers based on their performance against negotiated target prices.
CMS will initially test CARA within LEAD among ACOs that elect global risk and elect to participate in CARA. CARA will begin with a data sharing phase in PY 2027, with episode accountability launching at the start of PY 2028. CMS will communicate operational guidance through future LEAD communication. CMS may consider broader use of CARA in other total cost of care models or programs based on demonstrated success.
What new BEs and BEIs are included in LEAD?
New BEs and BEIs available under the LEAD Model in PY 2027 include:
- Medical Nutrition Therapy (MNT): Through this BE, CMS would expand the conditions for which beneficiaries may receive covered MNT, beyond diabetes or renal disease, for Medicare beneficiaries in LEAD ACOs taking full risk. This BE would expand coverage for MNT among beneficiaries with other diet-sensitive conditions thus supporting the management of chronic diseases and promoting a healthier lifestyle among Medicare beneficiaries.
- Chronic Disease Prevention Prevention (BEI): This BEI would enable ACOs to offer healthy food products to support beneficiaries’ health as beneficiaries engage in healthy living activities (e.g., exercising) and participate in evidence-based programs that support the prevention and management of chronic diseases.
LEAD ACOs will have the choice of whether to implement any or all the BEs and BEIs offered under the model. Acceptance into LEAD is NOT contingent upon an ACO agreeing to implement any BE or BEI. LEAD ACOs that choose to implement BEs and/or BEIs must provide CMS with a proposed implementation plan for each BE or BEI it plans to offer, including how they will cover the cost of the services or products.
What is the Substance Access BEI and where is it available?
The Substance Access BEI gives model participants the option of consulting with their patients about the possible use of eligible hemp products. The implementation of this BEI and any related dispensing would be funded entirely at the participant’s expense; CMS would not cover the cost of such products. Further, CMS will have strict program integrity safeguards to ensure that these incentives do not result in program or patient abuse.
The Substance Access BEI is only available to participants in states where the eligible hemp products are considered legal.
The Substance Access BEI is also being made available to participants in the ACO REACH Model in PY 2026 and the Enhancing Oncology Model starting in performance period 6. More information is available in the Substance Access BEI Frequently Asked Questions.
Eligibility and Participation
How does CMS align beneficiaries to LEAD ACOs, and what minimum alignment requirements must ACOs meet?
CMS aligns beneficiaries to LEAD ACOs through claims-based alignment and voluntary alignment. CMS performs claims-based alignment for every ACO based on the Participant TIN list submitted for the PY. Beneficiaries may voluntarily align through Medicare.gov Voluntary Alignment (MVA) or through Signature-based Voluntary Alignment (SVA), if the ACO elects to participate in SVA. CMS incorporates MVA submissions automatically for all ACOs.
LEAD ACOs must also meet both a PY alignment minimum and a base-year claims-based alignment minimum. For PY 2027, Renewing ACOs that do not qualify for lower High Needs/ESRD minimums must have at least 5,000 aligned beneficiaries during the PY and at least 3,000 claims-based aligned beneficiaries in at least one historical base year. ACOs that qualify for the High Needs/ESRD lower minimum must have at least 800 aligned beneficiaries during the PY and at least 500 claims-based aligned beneficiaries in at least one historical base year. Newly Entering ACOs must have at least 1,000 aligned beneficiaries during the PY and at least 600 claims-based aligned beneficiaries in at least one historical base year.
CMS will inform ACOs in December 2026 of their applicable alignment minimum standard and whether they meet that standard, with or without an available alignment buffer, for PY 2027.
LEAD ACOs must meet minimum beneficiary alignment thresholds to participate. These thresholds include both a PY alignment minimum and a base-year claims-based alignment minimum. The base-year claims-based minimum must be met in at least one of the three historical base years.
For PY 2027:
- Standard ACOs must have at least 5,000 aligned beneficiaries during the PY and at least 3,000 claims-based aligned beneficiaries in at least one historical base year.
- ACOs eligible for the High Needs/ESRD lower minimum must have at least 800 aligned beneficiaries during the PY and at least 500 claims-based aligned beneficiaries in at least one historical base year.
- Newly Entering ACOs must have at least 1,000 aligned beneficiaries during the PY and at least 600 claims-based aligned beneficiaries in at least one historical BY.
The minimums for Newly Entering ACOs and ACOs eligible for the High Needs/ESRD lower minimum increase over the first several PYs, as documented in the LEAD Alignment and Financial Methodology Paper (PDF).
Does LEAD offer prospective payments? If so, what are the options?
LEAD will provide ACOs with monthly prospective payments to support enhanced care investments and greater flexibility to deliver patient-centered care. LEAD includes:
- Primary Care Capitation (PCC): Monthly capitated payments for primary care services delivered by the ACO’s Participant and Preferred Providers. PCC includes both the Base PCC, which covers the cost of delivering Medicare-covered primary care services to aligned beneficiaries, and the Enhanced PCC (EPCC), which provides ACOs with upfront cash flow to invest in infrastructure, staffing and workflow changes, and other improvements to support ACOs’ performance. The EPCC must be paid back to CMS in full at the end of the PY. ACOs enrolled in the Professional Risk Option are required to select PCC, while ACOs enrolled in the Global Risk Option can choose between PCC and Total Care Capitation.
- Total Care Capitation (TCC): For those in the Global Risk Option, LEAD will also offer the option of capitated payments for all Medicare Parts A and B services delivered by the ACO’s Participant and Preferred Providers, including both primary and specialty care.
- Non-Primary Care Capitation (NPCC): ACOs that select PCC have the option of also selecting NPCC, which is a monthly capitated payment covering non-primary care services provided by enrolled Participant and Preferred Providers (e.g., specialists and post-acute care facilities). NPCC is a new payment option in LEAD and is a true capitated payment; unlike APO, NPCC is not reconciled based on fee-for-service (FFS) billing.
- Advanced Payment Option (APO): Also optional for ACOs that elect PCC, APO will be an upfront monthly payment for non-primary care services delivered by enrolled Participant and Preferred Providers that will be reconciled against actual FFS billing throughout the PY.
- Administrative Add-On Capitation Payments: ACOs with higher-than-average spending compared to their region will be eligible for an additional capitated payment, calculated as a percent of the ACO’s benchmark. This payment is designed as an upfront benchmark adjustment to encourage investments in primary care and other services that will enable eligible ACOs to reduce Medicare expenditures for LEAD-aligned beneficiaries over time. This payment will not be reconciled at the end of the PY, and it will not be included in PY expenditures when calculating shared savings/losses.
What is LEAD’s quality measurement strategy?
LEAD will offer ACOs clear, achievable criteria rooted in a small, targeted set of familiar quality measures to reduce provider burden. LEAD’s measure set includes four claims-based measures, one patient experience measure, and two digital quality measures (dQMs) or electronic clinical quality measures (eCQMs) that will be phased in throughout the first half of the model to align with LEAD’s focus on prevention, with the first two years reporting being optional. CMS aims to minimize eCQM reporting burdens for ACOs by focusing on reporting for aligned Medicare beneficiaries. Specifically, LEAD's quality measure set includes:
- Risk-Standardized All-Condition Readmission (claims-based)
- All-cause unplanned admissions for older adults with multiple chronic conditions (claims-based)
- Days at home for patients with complex, chronic conditions (claims-based)
- Timely follow-up after acute events for certain chronic conditions (claims-based)
- Patient experience: Consumer Assessment of Healthcare Providers and Systems (CAHPS) survey (patient-reported)
- Diabetes care – Glycemic Status Assessment greater than 9% (eCQM/dQM) - reporting optional for PYs 2027 and 2028
- Blood pressure control (eCQM/dQM) - reporting optional for PYs 2027 and 2028
Similar to ACO REACH, LEAD will include a Continuous Improvement/Sustained Exceptional Performance (CI/SEP) component and a High Performers Pool to reward ACOs that attain statistically significant improvement year-over-year and high overall performance. ACOs will also be able to attain additional quality points by submitting a Prevention Quality Plan detailing a prevention intervention being implemented to enhance the wellbeing of aligned beneficiaries.
ACOs have 3% of their benchmark at risk for quality, which they can earn back based on performance. Payments are not withheld during the year; at financial settlement, only the portion not earned back is applied when calculating shared savings/losses.
Will there be future application cycles or cohorts?
CMS anticipates additional application opportunities for subsequent cohorts and will announce any future LEAD application opportunities and associated timelines through future RFAs or program guidance. Organizations interested in participating in LEAD should monitor CMS communications for updates on future application windows and should subscribe to the LEAD Model listserv.