New model to serve as the successor ACO REACH.

Nashville, TN – December 22, 2025 – CMS’ Innovation Center has announced a new voluntary ACO model called LEAD (Long-term Enhanced ACO Design), which CMS is positioning as the successor model to ACO REACH. LEAD will begin in PY2027, with applications open in March 2026.

At this stage, CMS has shared high-level design elements. Here’s the skinny:

Timeline

• 10-year model: January 1, 2027 – December 31, 2036

• Applications anticipated to open March 2026

Risk Options

• Global: up to 100% shared savings and losses

• Professional: up to 50% shared savings and losses

Benchmarking

• CMS signals a more stable benchmarking approach, designed to avoid rebasing

• Specific benchmark methodology has not yet been released

Payment & Cash Flow

• Planned enhanced flexibility, including capitated, population-based payment options

• Detailed mechanics are still to come

Benefit Enhancements & Beneficiary Engagement

• Potential new tools such as Part B cost-sharing support

• A Part D premium buy-down concept beginning in 2029

Rural Support

• A referenced rural add-on payment that would not be reconciled (details TBD)

Special Design Elements

• CARA (CMS Administered Risk Arrangements): intended to support downstream, episode-based risk with specialists and preferred providers

• A planned pathway to test Medicaid integration in partnership with two states

Key Technical Details Still Pending

• CMS has not yet released the full LEAD technical package, including:

  • Benchmark construction details (baseline years, trend, regional vs. national components, risk adjustment, and mechanics of “without rebasing”)

  • MSR/MLR rules, risk corridors, loss limits, stop-loss provisions, and settlement timing

  • Population-based payment mechanics (amounts, timing, reconciliation, repayment)

  • Quality scoring methodology and any associated discounts or withholds

  • Coding intensity factors

  Based on CMS’s stated timeline, we expect additional technical detail in Q1 2026, on or before applications open in March.

Our Initial Take

We’re just starting to read the tea leaves, and we like what we see. It’s not a stretch to say that LEAD represents an important signal for the future of value-based care. CMS is clearly reinforcing its commitment to models that reward long-term investment, operational discipline, and accountability while creating more durable and incentivized pathways for providers to participate meaningfully in risk-based arrangements.

We’ll continue to provide analysis as more information about the LEAD Model is known, so be sure to follow the official Wellvana LinkedIn page to stay up to date.