On March 31, CMS released the Long-term Enhanced ACO Design (LEAD) Model Request for Applications (RFA), meant to encourage a broader range of providers, including smaller, rural, and independent practices, to participate in Medicare accountable care. Under LEAD, CMS has introduced a new voluntary initiative under the Global Risk Option: the CMS-Administered Risk Arrangements (CARA). CARA is intended to provide access to shared data and ease the administrative burden for ACOs to work with specialists.
During our April 13 webinar, the McDermott+ and McDermott Will & Schulte teams highlighted key policy design features, operational and financial considerations, and legal and compliance questions that are already emerging from the RFA.
Watch the recording here, and read on for key takeaways. For more on the LEAD Model RFA, read our +Insight.
The model builds on features used in ACO REACH, such as prospective beneficiary alignment and total cost of care accountability for ACOs, while adding a new Medicaid alignment pathway for full-benefit dually eligible beneficiaries through a nested model where CMS will select two states for a pilot program with an initial planning phase from March 2026 through December 2027. Additionally, LEAD introduces refinements such as mid-year updates to claims-based alignment for participating TINs added mid-performance year. LEAD also continues the focus on high-needs populations established in ACO REACH, including creation of a defined high-needs beneficiary category with tailored benchmarking and risk adjustment.
The model establishes a 10-year benchmark with no rebasing to address the “ratchet effect” seen in prior ACO models, providing greater predictability for participants. Benchmarks are calculated using three years of historical ACO and regional data, and are risk adjusted, and stratified by population (e.g., aged and disabled, end stage renal disease, high needs beneficiaries) and alignment type. ACOs are accountable for total Medicare Parts A and B spending, with CMS comparing actual spending to benchmarks to determine shared savings or losses. Participants may choose between global risk (for up to 100% shared savings/losses) and professional risk (up to 50% shared savings/losses). The model also includes ACO-specific adjustments and prospective, monthly payments to support cash flow, while maintaining fee-for-service billing with defined reductions.
Beginning January 1, 2028, CARA is a voluntary initiative that allows LEAD ACOs in the global risk option to partner with preferred providers through episode-based risk arrangements (EBRAs) across a broad set of clinical conditions. CMS offers two participation pathways: a default approach using CMS-designed episode-based cost measures and a maximal flexibility approach that allows ACOs to customize trigger codes, included or excluded services, and methodologies. The inclusion of both medical and procedural episodes – alongside innovations like the Resilience and Independence in a Safe Environment (RISE) to Age in Place episode promoting home-based, team-driven interventions such as occupational therapy and nursing support – signals CMS’s intent to bring specialists into total cost of care accountability through defined, episode-based structures that support coordinated, team-based care.
Additional Speakers:
When:
April 13, 2026 | 3:00 – 3:30 PM EDT
Where:
Webinar
