Participation
Provider Structure (RFA §VI.A)
LEAD distinguishes between two types of providers:
Participant TINs (required):
- Full-TIN participation is mandatory: all providers billing under a Participant TIN on the ACO’s Participant TIN List are included.
- Participant TINs are the basis for claims-based alignment.
- Primary care specialists within Participant TINs must participate in PCC (or TCC if elected).
- Participant TINs are mandatory for capitation participation.
Preferred Providers (optional):
- May participate at the TIN-NPI level, providing granular control over which individual providers are included.
- Optional for capitation (may opt into TCC, PCC, NPCC, or APO).
- Eligible for shared savings distributions, benefit enhancements, and CARA episode-based risk arrangements.
- Not used for claims-based alignment.
New in LEAD: The full-TIN requirement for Participant Providers is a change from ACO REACH, which allowed more flexibility in provider-level participation within a TIN. This simplifies administration but means ACOs must carefully evaluate which TINs to include, since all providers under that TIN become part of the model.
Model Overlap Rules (RFA §VI.F)
LEAD Participant TINs will likely be prohibited from simultaneously participating in:
- Medicare Shared Savings Program (MSSP)
- ACO Primary Care FLEX Model
- AHEAD Hospital Global Budget model
- Geo AHEAD
LEAD Participant TINs will likely be permitted to simultaneously participate in:
- GUIDE (Guiding an Improved Dementia Experience) Model
- TEAM (Transforming Episode Accountability Model)
- ACCESS (Advancing Chronic Care with Effective, Scalable Solutions)
- ASM (Advancing All-Payer Health Equity Approaches and Development)
- EOM (Enhancing Oncology Model)
- Primary Care AHEAD (in certain circumstances)
Final model overlap policies will be published in annual LEAD methodology papers.
ACO Service Area (RFA §VI.D)
To be aligned to a LEAD ACO, a beneficiary must reside in a county in the ACO’s service area. CMS defines the service area based on the Participant TIN List:
Core Service Area: Counties in which the ACO’s Participant TINs have physical office locations. Counties do not need to be contiguous; an ACO could operate in multiple counties across one or more states. (RFA §VI.D)
Extended Service Area: Counties contiguous to the Core Service Area, capturing beneficiaries within a reasonable distance. (RFA §VI.D)
Alternative Service Area proposals: ACOs may propose an alternative approach if their standard service area doesn’t fit their care model. Examples include rural practices whose beneficiaries travel farther, or home-based primary care practices that don’t rely on a physical practice location. The proposal must document the ACO’s capability to operate in the proposed area, including beneficiary counts, years of activity, and capacity for face-to-face care. (RFA §VI.D)
Screening Requirements (RFA §VI.B)
Applications undergo a Program Integrity (PI) screening covering the Applicant ACO, persons with ownership or control interest, Key Executives, equity partners, and proposed Participant TINs and Preferred Providers. The screening includes:
- Confirmation of current Medicare enrollment status and history of adverse enrollment actions
- Identification of delinquent Medicare and Medicaid debt
- Review of performance in other CMS models, demonstration programs, and initiatives
- Review of compliance with Medicare and Medicaid program requirements
- Review of billing history and any administrative audits or investigations regarding suspicious billing
- Review of any administrative, civil, or criminal actions related to integrity
Required disclosures include: sanctions or corrective action plans within 3 years, fraud investigations within 3 years, outstanding debts to Federal healthcare programs, CMS contract awards in 5 years, government suspension/debarment/exclusion lists, criminal convictions, and bankruptcy filings. (RFA §VI.B)
Participant TIN and Preferred Provider lists are not collected as part of the application, but are submitted before the PY start and subject to their own PI screening. (RFA §VI.B)
Certified EHR Technology Requirements (RFA §VI.E)
LEAD ACOs must ensure that Participant Providers who are eligible clinicians use certified EHR technology (CEHRT) in accordance with 42 C.F.R. § 414.1415(a)(1)(iii). (RFA §VI.E)
Transitional CEHRT Pathway: A one-year transitional pathway allows ACOs to identify clinicians that require a temporary exception for CEHRT compliance, provided those clinicians attest to a plan for achieving future compliance. This serves as an on-ramp for clinicians who have not previously been required to use CEHRT. (RFA §VI.E)
Advanced Custom Health IT Deferral: A three-year CEHRT deferral pathway is available for providers utilizing advanced, custom, or home-grown health IT systems. Organizations must attest to meeting certain technical capabilities in year 1 (including API requirements for data sharing, participation in TEFCA-aligned networks, and quality measurement/reporting infrastructure). The eCQM requirements are NOT subject to this deferral. (RFA §VI.E)
Advanced APM Determination (RFA §VI.G)
CMS expects LEAD to meet the criteria at 42 C.F.R. § 414.1415 to be an Advanced Alternative Payment Model (APM) under the CMS Quality Payment Program (QPP). LEAD ACOs are considered MIPS APMs. Eligible clinicians who do not attain Qualifying Participant (QP) status for a PY are eligible to participate in the Alternative Payment Model Pathway (APP) and be scored as MIPS APM participants. (RFA §VI.G)
Key Insight: If LEAD qualifies as an Advanced APM under the Quality Payment Program, eligible clinicians who achieve Qualifying Participant (QP) status can receive the Advanced APM incentive payment (historically framed as a lump-sum percentage in CMS rulemaking; amounts and years are set annually) and may be exempt from MIPS reporting and payment adjustments.
ACO Structure and Governance (RFA §VI.C)
- ACOs must have a governing body with at least 75% of members being ACO participants or their designated representatives.
- At least one beneficiary representative must serve on the governing body.
- ACOs must designate an ACO Executive who has authority to bind the ACO and make decisions.
- A compliance plan, including FWA (fraud, waste, and abuse) protocols, is required.
ACO Governance and Leadership (RFA §VI.C)
Governing Body Requirements:
- Must be separate and unique to the ACO (not the same as a participating entity’s governing body, unless all providers bill under a single TIN)
- At least 75% control (by voting power) held by Participant Providers, Preferred Providers, or their designated representatives (exceptions may be requested)
- Must not include a Prohibited Participant or an owner/employee/agent of a Prohibited Participant
- Must have a conflict of interest policy with disclosure requirements and remedial action procedures
- Must receive periodic reports from a designated compliance official (who cannot serve as ACO legal counsel)
Beneficiary Representation (choose one):
- Option 1: At least one Medicare beneficiary (or caregiver) serving on the governing body with voting rights
- Option 2: A Beneficiary and Consumer Advisory Committee with ≥5 members reflecting the ACO’s geography and demographics, meeting at least twice per year and submitting ideas to the governance process
Leadership:
A senior-level medical director who is a Participant Provider, physically present on a regular basis at a participating location, and licensed in a state where the ACO operates (RFA §VI.C)
An executive/officer/manager whose appointment and removal are under the governing body’s control
Convener Rules (RFA §VI.A)
LEAD prevents selection issues related to ACOs moving providers between affiliated ACOs. Participant TINs may not participate with a LEAD ACO affiliated with a particular convener if they have participated in a different LEAD ACO affiliated with that same convener within the past 3 Performance Years. (RFA §VI.A)
Financial Guarantee (RFA §IX.E)
CMS requires ACOs to secure a financial guarantee as collateral against Shared Losses and certain capitation-related exposures (for example, Enhanced PCC). This is an eligibility and creditworthiness requirement, not a step in the settlement formula itself: it backsstop obligations if the ACO owes losses or must repay advances, rather than changing how benchmarks or corridors are calculated.
| Component | Professional | Global |
| Shared Losses + Base PCC | 2.0% of prior year A&B | 2.5% of prior year A&B |
| Enhanced PCC (optional) | 1.5% | 1.5% |
| Combined | 3.5% | 4.0% |
| TCC (Global only) | N/A | 4.0% |
ACOs may secure two separate guarantees (one for Enhanced PCC, one for everything else) or one combined guarantee. Different guarantee types (for example, escrow for one, surety bond for the other) are permitted. (RFA §IX.E)
Monitoring, Auditing, and Terminations
Compliance Plan Requirements
Under the PY Participation Agreement, all LEAD ACOs must maintain a compliance plan with at least the following: (RFA §XII.A)
- Designated compliance officer (cannot serve as ACO legal counsel; reports directly to governing body)
- Mechanisms for identifying and addressing compliance problems
- Compliance training for the ACO, Participant Providers, and Preferred Providers
- Anonymous reporting method for employees, contractors, and providers to report suspected problems
- Requirement to report probable violations of law immediately to appropriate law enforcement
- Compliance plan must be updated as laws and regulations change
Remedial Actions for Noncompliance
If CMS determines a provision of the PY PA may have been violated, it may take one or more of the following actions (severity-dependent): (RFA §XII.B)
- Notify the ACO (and if appropriate, the specific Participant TIN or Preferred Provider) of the violation
- Require the ACO to provide additional information
- Conduct on-site visits, interview beneficiaries, or take other investigative actions
- Place the ACO on a monitoring and/or auditing plan
- Require removal of specific Participant TINs or Preferred Providers from the ACO’s lists
- Require the ACO to terminate its relationship with any individual or entity performing ACO-related functions
- Prohibit the ACO from distributing Shared Savings to a specific Participant TIN or Preferred Provider
- Request a Corrective Action Plan (CAP) acceptable to CMS by a CMS-specified deadline
- Amend the PY PA without the ACO’s consent to deny, terminate, or amend capitation mechanisms
- Amend the PY PA to deny Enhanced PCC (CMS would recalculate PCC without Enhanced PCC)
- Prohibit the ACO from accessing any or all benefit enhancement waivers
- Amend the PY PA to deny benefit enhancements and require termination of related agreements
- Prohibit the ACO from furnishing in-kind items or beneficiary engagement incentives
- Discontinue data sharing and reports to the ACO
- Prohibit the ACO from participating in voluntary alignment, distributing marketing materials, or conducting marketing activities
- Retroactively reverse voluntary alignment (including Hybrid Alignment) of beneficiaries
Termination
CMS may immediately or with advance notice terminate an ACO’s participation for noncompliance or as required by section 1115A(b)(3)(B) of the Act. (RFA §XII.C)
An ACO may give CMS notice of termination at any time, effective at least 30 days after notice. Starting in the ACO’s second Performance Year, the Termination Without Liability (TWL) deadline is the later of: (RFA §XII.C)
- February 28 of the Performance Year, OR
- 30 days after CMS distributes the PY Benchmark Report to the ACO
However, the TWL deadline is no later than August 31 of the Performance Year even if 30 days have not elapsed since the Benchmark Report was distributed. ACOs that terminate before the TWL deadline are not liable for shared losses for that PY.
Data Sharing and Reports
CMS will share data with LEAD ACOs to support care management and population health activities, subject to HIPAA requirements: (RFA §XIII)
Data Provided
- Claims and Claims Line Feed (CCLF) files for aligned beneficiaries
- Beneficiary-level alignment and eligibility data
- Preliminary and final benchmark reports
- Quality performance reports
- Shadow bundles / CARA episode data (for ACOs that sign the LPACA)
Data Suppression Rules
- Opt-out beneficiaries: Identifiable data is excluded for beneficiaries who decline data sharing. However, their claims still count for alignment, risk adjustment, cost sharing, stop-loss, monitoring, evaluation, and PY expenditure calculation. Their claims are NOT subject to capitation fee reductions. (RFA §XIII.B)
- SUD data: Individually identifiable substance use disorder data is omitted for all beneficiaries. Aggregate reports incorporate de-identified SUD data. SUD claims are excluded from capitation fee reductions. (RFA §XIII.B)
- Terminated provider data: If a Participant Provider is terminated and a beneficiary’s sole care relationship was with that provider, the beneficiary’s identifiable data is suppressed. Data sharing resumes if another Participant Provider establishes a care relationship. (RFA §XIII.B)
All ACOs must establish administrative, technical, and physical safeguards to protect data confidentiality, consistent with HIPAA Privacy and Security Rules (45 C.F.R. Part 160 and Part 164). (RFA §XIII)
Evaluation
All ACOs must cooperate with an independent, federally funded evaluation conducted by CMS and/or its designees. This may include surveys, interviews, site visits, and other activities. The evaluation will assess LEAD’s impact on beneficiary outcomes, provider behaviors, financial risk effects, payment arrangement impacts, beneficiary engagement, and CARA initiative effectiveness. Non-cooperation may result in PY PA termination. (RFA §XIV)
Additional CMS Supports
Tech Enabler Initiative
CMS will work with provider organizations to identify high-value technology and AI use cases, establish technology application requirements, and create a channel for vendors to share capabilities. In early years, LEAD will prioritize 1–2 use cases: (RFA §XV.A)
- Care Navigation: Tech/AI-enabled tools helping beneficiaries understand conditions and find high-value providers
- Condition Management: Digital tools connecting care plans and helping patients manage chronic conditions (e.g., diabetes, cardio-metabolic health)
- Community Providers: Digital tools supporting ACOs in identifying, communicating, and contracting with community-based organizations
Technology adoption is completely optional and will not affect CMS evaluation or determinations.
Rapid Cycle Innovation Program
LEAD participants can conduct time-limited rapid randomized controlled trials (Rapid RCTs) to quickly test prevention and care delivery strategies. Examples: testing the best method for engaging providers in preventive care plans, optimizing technology adoption, or identifying the best approach for chronic condition management communication. Effective strategies are rapidly shared with all participants. Rapid RCTs complement the model evaluation by offering tactical evidence more quickly. CMS will work with ACOs to confirm priority topics aligned to LEAD goals. (RFA §XV.B)
Learning System
CMS operates a cross-model learning system using quality improvement and implementation science principles. LEAD ACOs participate in group-learning forums, access a virtual CMS platform with foundational resources, and engage in peer-to-peer collaboration and networking with participants from LEAD and other Innovation Center models. (RFA §XV.C)
Frequently Asked Questions
Yes. The prohibition is at the TIN level, not the organization level. A health system could have certain TINs in LEAD and others in MSSP, as long as no individual TIN participates in both.
Yes. ACOs that participated in ACO REACH for PY 2026 are eligible for an abbreviated application. CMS also intends to carry forward valid voluntary alignment attestations from REACH when the same provider participates through the same ACO entity. (RFA §IV.A, §VII.B.2)
For renewing organizations, benchmark base-year weighting is another difference: LEAD applies equal weight (one-third each) to the three baseline years for Renewing ACOs, whereas ACO REACH and MSSP (for renewing ACOs) placed more weight on the most recent year (60% / 30% / 10%), so the newest year had more influence there than it does in LEAD.
A convener is an organization that doesn’t itself include Medicare-enrolled providers but provides administrative and supportive services to facilitate ACO participation in value-based care. The 3-year restriction prevents conveners from shuffling high-performing TINs between their ACOs to maximize savings. (RFA §VI.A)
CMS expects that it will, meaning eligible clinicians can earn the QPP incentive payment and may be exempt from MIPS when they achieve QP status. (RFA §VI.G)
LEAD offers a 3-year CEHRT deferral for organizations with advanced custom health IT, provided they meet certain technical capabilities (API standards, TEFCA network participation, quality reporting infrastructure) in year 1. (RFA §VI.E)
CMS has a graduated enforcement toolkit with 16+ remedial actions, ranging from notification and information requests to CAPs, removal of specific providers, denial of capitation or benefit enhancements, retroactive reversal of voluntary alignment, and ultimately termination. The action depends on the nature and severity of the violation. (RFA §XII.B)
Yes, if you terminate before the TWL deadline (later of February 28 or 30 days after receiving the Benchmark Report, but no later than August 31). After the TWL deadline, you remain liable for the PY’s shared losses. (RFA §XII.C)
CCLF claims files, alignment/eligibility data, benchmark reports, quality reports, and CARA episode data (if signed up). Data for opt-out beneficiaries and SUD claims is suppressed from identifiable reports but still counts in expenditure calculations. (RFA §XIII)
