What to Know About the Long-Term Enhanced ACO Design (LEAD) Model Request for Applications
The Request for Applications (RFA) for the Long-Term Enhanced ACO Design (LEAD) Model is now available and due May 17, 2026. The model is the Centers for Medicare and Medicaid Services’ (CMS’s) newest accountable care initiative, launching in 2027 as the successor to ACO REACH.
It reflects a continuation and refinement of CMS’s approach to total cost of care models. For organizations focused on high-needs populations, particularly those delivering long-term care or home-based primary care, the model aligns closely with existing care delivery approaches and should be seriously considered. At the same time, the benchmarking approach in the early years is broadly similar to the Medicare Shared Savings Program (MSSP), which may limit immediate financial differentiation for organizations currently participating in MSSP or considering participation in 2027.
We highlight below key elements of the model: application requirements, participation rules, and financial methodology.
Application Overview
Applications are due May 17, 2026 (11:59 PM ET), with selected participants expected to be notified in late June. The application process is expected to be competitive –meeting the eligibility criteria does not ensure acceptance.
ACO REACH PY 2026 participants may submit an abbreviated application, although acceptance is also not guaranteed. All other applicants must complete a full submission. The application requires detailed information on ACO structure, governance and leadership, financial guarantee approach, participation selections, and clinical care model, along with disclosures related to compliance, ownership, and experience.
CMS will evaluate applications across five domains:
Organizational readiness
Payment arrangements
Beneficiary experience
Data and health information
Preventive care
They will also consider cross-cutting factors such as financial stability, operational capability, and program integrity risk. While prior ACO performance is not a formal scoring category, it is also considered. Applications should clearly describe prior experience, performance, and operational capabilities.
Organizations seeking to participate in Medicare ACO models in 2027 should consider applying to MSSP in parallel with LEAD. Beneficiary overlap is not permitted, and participation decisions will need to be finalized by the provider add (August 5) or drop deadlines (September 8).
Participation Requirements
LEAD requires participation at the TIN level, meaning all NPIs billing under a TIN must be included. While this approach may simplify administration, it also limits the ability to include only select providers, which may present challenges for organizations with varied readiness across practices.
ACOs may designate preferred providers, typically specialists, at the TIN-NPI level. These providers are excluded from attribution, quality reporting, and Quality Payment Program Qualifying Participant (QPP QP) determinations.
Governance requirements include a distinct governing body with at least 75% provider control and formal beneficiary engagement. This can be achieved through either board representation – including caregivers – or a beneficiary advisory committee.
ACOs must also maintain a CMS-approved financial guarantee, with requirements varying based on selected risk arrangements and payment mechanisms.
Key Model Design Elements
Eligibility and Attribution
LEAD incorporates both claims-based and voluntary alignment. Claims-based attribution is based on plurality of allowed charges for primary care qualified evaluation and management services. When primary care clinicians account for more than 10% of these charges, attribution is based solely on those providers. When this threshold is not met, selected specialists are included.
The model introduces a hybrid alignment option, allowing for more timely updates to TIN lists during the PY.
Minimum attribution thresholds vary depending on ACO type:
Standard ACOs: 5,000 aligned beneficiaries in PY1, including 3,000 claims-based aligned in at least one base year (2024 to 2026)
ACOs with more than 40% of beneficiaries meeting the High Needs criteria: 800 aligned beneficiaries, including 500 claims-based aligned in at least one base year (2024 to 2026)
Newly entering ACOs: 1,000 aligned beneficiaries, including 600 claims-based aligned in at least one base year (2024 to 2026)
The High Needs definition is largely consistent with ACO REACH, with the addition of the Kim Claims-based Frailty Index. Once a beneficiary is classified as High Needs, that designation remains for the duration of the model.
Newly Entering ACOs are defined by meeting all the following criteria:
The legal entity has not participated in a Medicare ACO initiative previously or currently
Less than 40% of the Participant TINs have participated in a Medicare ACO initiative in the past 5 years
Less than 50% of Participant Providers have participated in a Medicare ACO initiative in the past 5 years
ACOs qualifying for lower attribution thresholds must demonstrate capabilities such as 24-hour access to care, advanced care planning, and the ability to deliver care in the home.
TIN-level participation combined with this attribution approach may increase specialist involvement in attribution for multi-specialty organizations compared to MSSP and REACH.
Financial Methodology
LEAD includes two risk tracks:
Professional risk with 50% shared savings and losses
Global risk with 100% shared savings and losses
ACOs must select one of two capitation options:
Total Care Capitation, available only for Global ACOs
Primary Care Capitation, including an enhanced option
Additional options include Non-Primary Care Capitation and the Advanced Payment Option.
Benchmarking (Performance Years 1 to 5)
Benchmarking is based on historical performance using 2024 to 2026 base years:
Newly entering ACOs: weighted 10%, 30% and 60%
Renewing ACOs: evenly weighted (33.33% each)
A three-way blended trend applies, consisting of two-thirds national or regional trend and one-third Accountable Care Prospective Trend, with guardrails limiting its impact. Additional adjustments include:
Regional efficiency or prior savings
1.5% add-on capitation for higher-spending ACOs
Discount for Global ACOs ranging from 1.75%-3% depending on the ACO designation as higher vs. lower spending
This structure is similar to MSSP in the early years. Differences include the treatment of High Needs populations, the use of guardrails on the blended trend, and the add-on capitation for higher-spending ACOs. LEAD also removes the retrospective trend adjustment used in ACO REACH.
Benchmarking (Performance Years 6 to 10)
A rate book-based approach will be phased in, although details have not yet been specified.
Risk Adjustment
Risk adjustment uses prospective Hierarchical Chronic Conditions (HCC) models for non-High Needs beneficiaries and concurrent models for High Needs populations. A 3% risk score growth cap applies, with higher caps for High Needs populations, using base year 3 as the reference.
LEAD does not include a symmetric cap on risk score decreases. The model also introduces a transition to AI-informed risk scoring, with shadow testing beginning in 2028 and hybrid implementation in 2029.
CMS Risk Administered Arrangements (CARA)
CARA will allow Global ACOs to establish episode-based risk arrangements with preferred providers using CMS infrastructure. Reconciliation will occur concurrently with LEAD settlement, with implementation beginning in PY 2028.
Quality Reporting
ACOs are required to report:
Four claims-based measures
CAHPS
Two eCQMs, with phased implementation
A 3% quality withhold applies and can be earned back based on performance. Quality is incorporated into the benchmark rather than serving as a gate on shared savings. LEAD also applies more graduated performance incentives, including Continuous Improvement and Sustained Exceptional Performance, rather than all-or-nothing bonus structures. Lastly, ACOs must implement a Prevention and Quality Plan.
CMS Supports
LEAD introduces new Benefit Enhancements/Beneficiary Engagement Incentives for PY2027, including expanded medical nutrition therapy for Global ACOs, chronic disease prevention supports, Part B cost-sharing support, and substance access to eligible hemp products. It also continues key waivers from ACO REACH, including telehealth, the skilled nursing facility (SNF) three-day rule waiver, and home-based care flexibilities.
In their new Tech Enabler Initiative, CMS will work with ACOs to identify technology and AI use cases and create a pathway for vendors to share capabilities. Potential use case areas include care navigation, condition management, and community providers.
These features are optional and should be evaluated in the context of the broader model, rather than as drivers of model participation.
Considerations for Organizations
For organizations where early financial differences between LEAD and alternative ACO programs are limited, participation decisions may depend on several additional factors:
Payment approach: whether capitation creates strategic or financial advantage and whether the organization has the capacity to implement it
Quality approach: differences in structure, including the withhold, phased eCQM reporting, and measure feasibility
Model features: whether elements such as a targeted specialist engagement or benefit enhancements are central to the organization’s strategy
There is also uncertainty around long-term benchmark dynamics. Although LEAD is positioned as addressing the ratchet effect, rebasing will still occur after five years, likely toward a more regional benchmark. Many details remain to be specified.
Some policy elements, such as guardrails on the Accountable Care Prospective Trend, may also evolve over time and could be incorporated into MSSP in future rulemaking.
How Coral Can Help
LEAD requires organizations to make decisions in the context of evolving model design and policy uncertainty. Key elements remain unresolved, and assumptions about long-term predictability should be approached cautiously.
Participation may provide an opportunity to engage in a model that is being shaped over time. Organizations should ensure they have a clear understanding of the implications and avoid relying on assumptions about how outstanding elements will be finalized.
Contact us at info@coralhealthadvisors.com to learn how we can support your organization in evaluating and preparing for participation in the LEAD Model.