The LEAD Model: CMS's Most Ambitious ACO Program Yet

Context
How We Got Here — A Program That Kept Learning

The Medicare Shared Savings Program launched in 2013 with a simple premise: bring physicians and hospitals together into Accountable Care Organizations, hold them accountable for both the quality and cost of care for their attributed Medicare population, and share in the savings when they succeed. That premise has proven durable. Twelve years of MSSP data shows a program that matured significantly — from 23.6% of ACOs earning savings in 2013 to 75.4% in 2024, generating $4.1 billion in shared savings in a single year.

But MSSP was built for a different era of value-based care — one where the primary challenge was simply getting providers into risk-based arrangements at all. Over time, its limitations became clear. The three-year rebasing cycle penalized ACOs that performed too well by raising their benchmarks. High-needs populations were inadequately captured by prospective risk adjustment. Smaller and rural providers lacked the scale and infrastructure to participate meaningfully. And the program's relatively short agreement periods didn't give organizations enough runway to fully realize the return on their VBC investments.

The Innovation Center responded. ACO REACH introduced stronger financial incentives, capitated payments, and better high-needs risk adjustment. It expanded participation beyond traditional provider structures. It brought in health equity as an explicit program goal. It learned. And now, building on everything MSSP and ACO REACH taught about what works and what doesn't, CMS has announced its most ambitious accountable care model to date.

The Long-term Enhanced ACO Design — LEAD — isn't just another iteration. It represents a genuine rethinking of what a durable, sustainable, inclusive accountable care program can look like.

The Model
What Is LEAD?

LEAD is a voluntary, total cost of care ACO model launching January 1, 2027, following the conclusion of ACO REACH at the end of 2026. It will run for ten years — through December 31, 2036 — making it the longest performance period CMS has ever tested in any innovation model.

The model is designed to serve a broader mix of providers than previous Innovation Center models — explicitly including organizations new to ACOs, smaller and independent practices, rural providers, and organizations that disproportionately serve complex, high-needs, or dually eligible populations. This isn't window dressing: the program's financial architecture is specifically designed to make participation viable for these organizations in ways that MSSP and ACO REACH were not.

CMS's own data provides the rationale: as of January 2026, only 45% of Original Medicare beneficiaries are aligned to the Shared Savings Program or ACO REACH. Previous analyses show that providers not participating in ACOs exhibit higher per-beneficiary spend. Expanding participation isn't just a policy goal — it's where the Medicare savings potential is concentrated.

Key Features
What Makes LEAD Different

Risk Options
Choosing Your Path

LEAD offers two voluntary risk-sharing options. The right choice depends on your organization's financial position, care management maturity, and appetite for accountability. Both options use mandatory capitation — ACOs receive set payments rather than payment per claim, a fundamental shift from traditional billing models.

The Global option's access to CARA is significant for organizations ready to extend their accountability framework to specialist care — it creates the infrastructure for preferred provider relationships that can meaningfully reduce downstream costs in high-expense categories like post-acute care, orthopedics, and cardiology.

Fit Assessment
Who Should Seriously Consider LEAD

Current ACO REACH participants are the most natural candidates. LEAD is explicitly designed as ACO REACH's successor, and the transition pathway is as direct as CMS has made any model transition. For organizations that have invested in the infrastructure, culture, and clinical workflows to succeed in ACO REACH, LEAD offers a longer runway to realize that investment's return — without the disruption of re-entering a different program.

High-performing MSSP ACOs who have felt the sting of rebasing should look carefully at LEAD's ten-year, no-rebase structure. If your organization has consistently generated savings — and watched your benchmark rise in response — LEAD's stable benchmark offers a fundamentally different value proposition. The data shows that ACOs with 10+ years of experience average 5.20% savings rates. A stable benchmark lets that performance compound over time rather than being reset.

Providers new to ACOs — particularly smaller, independent, and rural practices — are an explicit focus of LEAD's design. The lower alignment minimums for high-needs ACOs, the add-on payments for rural and smaller providers, and the phased risk on-ramps make LEAD more accessible than previous Innovation Center models for organizations that have historically been priced out of meaningful VBC participation.

Organizations serving complex populations — high proportions of dual-eligible beneficiaries, homebound patients, or patients with significant chronic disease burden — will find that LEAD's concurrent risk adjustment, High Needs benchmarking, and Medicare-Medicaid integration work are specifically designed for their populations. The model doesn't require these organizations to fit their patients into a framework built for average Medicare beneficiaries.

LEAD is CMS making an explicit bet that the future of Medicare cost control runs through long-term, stable, inclusive accountable care relationships — not through short-term payment adjustments. For organizations ready to make that bet alongside CMS, the terms have never been better.

Timeline
Key Dates and Next Steps