By: Carlos Arce
Introduction
CMS has announced that ACO REACH will sunset at the end of 2026 and be replaced by a new model beginning in 2027, Long-term Enhanced ACO Design (LEAD). At first glance, this may feel like yet another program change in an already complex value-based landscape. In reality, this transition signals something far more important, CMS is actively rebuilding the ACO platform to ensure long-term viability, not walking away from it.
For providers currently participating in the ACO REACH program, the next year should be viewed as a transition and optimization period, not a wind-down. CMS has been clear that LEAD is intended to carry forward the core structure of REACH while addressing the issues that threatened its longevity, namely political pressure (new administration), participation barriers, and concerns around sustainability. A common concern I found prevalent this year in the ACO REACH program from a ACO and Provider perspective was the sustainability and longevity. Therefore, this is good news for organizations already invested in population-based care.
What Active ACO REACH Participants Should Expect Next
Between now and the end of REACH program, participants (primary care providers) should anticipate continued refinement rather than disruption. CMS has already adjusted benchmarking and risk-adjustment methodologies, and further clarification around attribution, performance measurement, and care coordination is likely as the agency prepares for LEAD. This was again another issue we saw from a provider standpoint when being involved within an ACO Reach. Importantly, CMS is signaling stability, which is a clear runway to 2027, rather than abrupt policy shifts.
The broader push is to make the ACO model more durable, more inclusive of smaller and rural providers, and more defensible as a long-term Medicare strategy. That intent alone should give current participants confidence that their investments in infrastructure, analytics, and care management will remain relevant.
What Providers in ACO REACH Should Focus on Improving
For providers already in an ACO REACH, the coming year is an opportunity to strengthen the fundamentals that will matter even more under the LEAD program:
The LEAD’s 10-year horizon will reward organizations that can demonstrate consistency and operational control, not just episodic performance.
- Risk management discipline: Understanding drivers of total cost of care and tightening clinical variation;
- Care coordination: Especially transitions of care, chronic disease management, and high-utilizer engagement;
- Specialist alignment: Preparing for more structured specialist risk-sharing arrangements;
- Data and reporting maturity: Using performance data proactively rather than reactively;
- Patient attribution and engagement strategies: Particularly for high-needs and dual-eligible populations; and
A Compelling Option for Providers Not Yet in ACO REACH
For providers who are not currently part of ACO REACH, but have contemplated capitation or risk-based models, this transition is equally important. LEAD reinforces that CMS-sponsored ACO participation is a viable alternative to dealing directly with commercial Medicare Advantage payers.
Many providers hesitate to enter risk arrangements because of opaque payer methodologies, shifting contract terms, and limited transparency. Ultimately, payors aren’t good partners, versus the idea of dealing directly with the government through an ACO has been more of a transparent approach. The ACO REACH, and soon LEAD, offers a different path. These models provide clearer benchmarking, standardized rules, and direct alignment with CMS rather than fragmented negotiations with multiple MA plans. For the right practice, participation can be lucrative. More importantly, it allows providers to engage in population-based payment without surrendering control to commercial payers whose incentives may not always align with clinical realities.
The Bigger Picture
CMS is not abandoning risk-based care. It is rebuilding it to last. LEAD represents a deliberate effort to preserve the strengths of ACO REACH while making the model more politically resilient, operationally accessible, and strategically sound.
For providers already in REACH, the message is clear: prepare, optimize, and lean in. For those on the sidelines, this may be the most transparent and provider-aligned entry point into capitation Medicare has offered to date.
The future of Medicare payment will not be fee-for-service. The question is not whether providers will adapt, but how and with whom.
