With the LEAD (Long-term Enhanced ACO Design) RFA expected to drop in the coming weeks, CMS hosted a virtual Executive Session on Monday, March 23 with REACH participants to discuss changes since the last session and respond to questions from the audience. Here’s what you need to know.

What’s New?

LEAD introduces several structural and operational changes aimed at improving upon REACH. CMS addressed a common concern amongst ACOs where many felt that annual claims based alignment is a limitation of ACO REACH with a demand for more frequent updates to claims based alignment. Additionally, many ACOs have previously voiced concerns even the quarterly update on voluntary alignment is not frequent enough . LEAD looks to address this feedback by introducing a hybrid alignment, allowing ACOs to submit voluntary alignment data monthly (rather than quarterly) and refresh claims-based alignment when new TINs are added mid-year, an operational improvement for organizations managing dynamic provider networks.

An even more notable shift in the alignment methodology is that the model shifts to a whole-TIN assignment, aligning with MSSP. While this simplifies attribution, it introduces new complexity for organizations with mixed provider panels, requiring broader participation across provider types.

Another key population-level change that has been mentioned before and was reinforced in today’s call, is the integration of high-needs beneficiaries across all ACOs, rather than isolating them within specific model tracks. Concurrent risk adjustment will be applied universally, increasing the importance of accurate coding and care management capabilities across all participants.

On the quality side, LEAD replaces REACH’s tiered structure with a single, standardized measure set, including a flat 3% withhold and the phased introduction of two eCQMs focused on diabetes and hypertension, transitioning to full pay-for-performance by 2031.

LEAD also introduces new tools to support care delivery and financial alignment. CARA (CMS Administered Risk Arrangement Initiative) provides a built-in episode framework for specialty contracting, while a new Non-Primary Care Capitation (NPCC) option allows ACOs to extend capitation into specialty care arrangements. Finally, LEAD marks the first inclusion of a Medicaid integration component within an ACO model, with a two-state pilot (one FFS, one managed care) expected to launch in 2028—though key details remain limited.

What’re We Still Waiting On?

Despite these advancements, several critical elements remain unresolved and are expected to be clarified in the RFA. These include benchmarking and trend methodology (particularly retrospective adjustments), financial guarantees and reconciliation mechanics, risk model versioning, and how mid-year high-needs population changes will be handled.

Additional open questions include the continuity of voluntary alignment from REACH, TIN transition logistics, and details surrounding Medicaid integration design and state selection. These uncertainties have direct implications for financial modeling and participation strategy.

Where There’s Concern

Benchmarking remains the primary concern among stakeholders. While CMS has introduced adjustments (e.g., regional efficiency, prior savings), there is continued skepticism around whether the methodology will produce stable and predictable financial outcomes, particularly given the shift toward accuracy-driven trending.

The whole-TIN requirement also presents a barrier, especially for systems with diverse provider mixes, as it reduces flexibility and may unintentionally pull specialists into primary care-focused risk structures.

Market stability is another emerging issue. Reports of TIN migration, driven in part by financial incentives from PE-backed entities, raise concerns about long-term alignment and the durability of ACO networks. Unresolved financial guarantee requirements and overlapping obligations during the transition from REACH to LEAD further contribute to participation risk. Additionally, while CARA and NPCC introduce new capabilities, their voluntary nature may limit impact if adoption is not widespread.

Key Considerations for Applicants

LEAD’s 10-year horizon is its defining feature, signaling CMS’s commitment to long-term value-based transformation and offering ACOs a longer investment timeline than prior models. However, participation will require careful evaluation.

As with ACO REACH, all ACOs participating in LEAD will be required to adopt a capitation structure, which will significantly influence financial risk and provider relationships. Alignment thresholds vary based on population mix, with lower minimums for ACOs serving a higher proportion of high-needs beneficiaries, potentially expanding access for smaller or specialized organizations. Organizations will need to closely assess the implications of whole-TIN participation, evaluate CARA and NPCC as optional (not assumed) tools, and closely monitor RFA guidance—particularly if transitioning from REACH. Finally, while still early, the Medicaid integration component may present a strategic opportunity, especially in markets with high dual-eligible populations.

Polls taken throughout the webinar showed a strong desire for participation in LEAD from existing ACO REACH members with 75 percent of participants indicating that they plan on applying for LEAD. However, many key details are still pending and ACOs will have little time to digest and understand all the impacts between RFA release to when the applications will need to be submitted. ACOs need to be ready to accurately assess their impact as soon as the details become available.

One thing CMS made clear is that everything is in the details of the RFA. It will be important for groups to understand all the nuanced details around alignment, benchmark, risk score, capitation methodology and financial reconciliation to determine what LEAD participation means for their organization. We at COPE Health Solutions are closely monitoring the details so we can help our partners quickly understand the operational and potential financial impact of participation.

Contact info@copehealthsolutions.com to learn more.