What family physicians need to know about the new LEAD ACO model

April 29, 2026

By Erin Solis, AAFP Manager of Practice and Payment

The Center for Medicare & Medicaid Innovation (CMMI) doesn’t sleep. In the last year, the agency has released more than nine new models and shows no signs of slowing down. Among those is the new Long-term Enhanced Accountable Care Organization (ACO) Design (LEAD) model. This model is the culmination of years of learnings in both CMMI models and the Medicare Shared Savings Program.

The AAFP recently hosted CMMI to discuss the new model, and explain what makes it unique from previous models and why family physicians should be paying attention. Be sure to watch the full presentation for a detailed explanation of the program.

In the meantime, here are some nuggets for family physician leaders (see what I did there?) to think about.

What is the LEAD model?

LEAD is a 10-year voluntary model for ACOs that combines lessons learned from previous models with a slew of new innovative features designed to appeal to a broader range of physicians and other health care professionals. CMMI has been explicit in stating that this model is meant to provide new opportunities to practices that have not previously participated in ACOs, particularly small, rural and independent practices, and those serving high-needs populations. LEAD will also serve as the successor to the REACH model, which concludes at the end of this year.

ACO REACH vs. LEAD: Key differences

REACH will run for a total of six years. LEAD will run for 10 years—the longest ACO model that CMMI has ever tested. Applications are open until May 17 and the model will start next year. Details are available in the request for applications. CMMI plans to offer additional application periods throughout the model.

LEAD also baked in several features that make participation and long-term success more attainable for both new and existing ACOs. These include providing more predictable benchmarks, and adjusting for an ACO’s prior savings and its spending compared to its region.

Another major change from REACH is that LEAD incorporates the High Needs track into the broader program. CMMI will apply unique benchmarking and risk adjustment methodologies to beneficiaries with high needs, but ACOs will be able to serve their entire population rather than being required to choose between two participation options.

In terms of similarities, LEAD continues the REACH payment framework by offering two risk options. ACOs can participate in the Global Risk Option or the Professional Risk Option. ACOs in the Global Risk Option may choose to receive total care capitation or primary care capitation. ACOs in the Professional Risk Option will receive primary care capitation.

Pros and cons of LEAD

The 10-year performance period represents CMMI’s strong commitment to offering both stability and sustainability for participants. ACOs will have an extended runway to transition from a fee-for-service environment as well as more time to implement changes and see their impact.

The revised benchmarking methodologies address longstanding challenges that ACOs faced, including the “ratchet effect.” LEAD will not rebase benchmarks—they will remain static for the duration of the model. This provides a new level of stability and predictability for ACOs. CMMI will also apply adjustments to account for an ACO’s historical savings and for ACOs that have baseline spending that is lower than average spending in their region. These adjustments are designed to support ACOs that are concerned their previous success would dampen the positive impact of the LEAD model.

LEAD includes incentives for ACOs on the other end of the spending spectrum. ACOs with spending that is higher than the rest of their region will receive an additional upfront monthly capitated payment. The add-on will be equal to 1.5% of the ACO’s benchmark, so it will provide a meaningful cash infusion that can be used to invest in primary care and other services. Importantly, this payment does not count toward the ACO’s shared savings nor is it subject to repayment.

New ACOs will have a lower minimum beneficiary alignment threshold, which opens the door for groups who have historically been excluded because they did not have a large enough beneficiary population.

While LEAD makes significant strides in the right direction, it is not without challenges. The biggest of these is that the capitated payments flow to the ACO rather than directly to the participating practices. CMS cannot direct ACOs about how they structure their agreements with participating practices. This doesn’t mean that practices can’t or won’t benefit from participating in a capitated ACO program. Whether they flow to the ACO or the practice, prospective capitated payments still offer a predictable and stable revenue stream. Practices both experienced and new to ACOs will need to work with their ACO to negotiate a contract that meets the needs of both the practice and the ACO.

Succeed in LEAD with AAFP resources

• Value-based care tips, CME and tools
• Members-only free CME: Caring for patients in value-based models
• Risk-stratified care management algorithm and rubric
• Using advanced primary care management services codes G0556, G0557 and G0558

Is LEAD right for your practice?

At this point you are probably ready for a big reveal that tells you whether your practice should participate in a LEAD ACO or not.

Let’s summarize what we know:

• LEAD is the longest ACO model CMMI has ever tested. They are committed.
• They intentionally designed it to appeal to practices that have not participated in an ACO by including features such as a lower minimum beneficiary threshold, a monthly administrative add-on capitated payment, and predictable and stable benchmarks.
• They also built on years of experience to include enhancements that make it a viable option for ACOs that have been successful in other models, such as benchmark adjustments to account for regional efficiency and prior savings, predictable and stable benchmarks and updated attribution options.
• LEAD provides a more flexible and predictable alternative to the traditional fee-for-service system.
• Payments are made to the ACO, who will be responsible for paying participating practices.

Now, should you participate? I would love to give you an “Absolutely!” but we don’t live in a world of absolutes. Every practice is unique, and the decision to participate in LEAD is one that warrants careful consideration. The decision should be based on what makes the most sense for you and your practice. So, the best I can offer is an “It’s absolutely worth thinking about!” 

If you have strong experience in pay for performance programs or other ACOs (either in Original Medicare or Medicare Advantage), LEAD may be a logical next step. As with any major decision, you will need to do your due diligence before joining an ACO. Since LEAD shifts ACOs out of the fee-for-service system, understanding how an ACO will distribute the capitated payments to participating practices will be crucial. Similarly, an ACO’s approach to distributing shared savings and losses is another key component to your relationship. LEAD offers higher rewards, but there are also higher risks.

If all of this left your head spinning, I have some good news. ACO applications are due to CMMI by May 17, but ACOs have until Aug. 5 to submit their participant lists. While ACOs will be looking to shore up their rosters sooner rather than later, you don’t have to decide right now. You have a little, albeit not a lot, of breathing room to find an ACO partner that is the right fit for you.

Erin Solis is the AAFP’s payment strategies manager. In this role, she serves as a subject matter expert to support the Academy’s payment advocacy efforts. She also supports the development of AAFP payment, billing and coding resources.