CMS just gave ACOs a 10-year runway. Here’s why most will stumble before takeoff — and how to actually execute.
CMS dropped the LEAD Model Request for Applications on March 31, 2026. Applications are due May 17. The model launches January 1, 2027, and runs for 10 years.
Ten years.
That’s the longest performance period CMS has ever tested in an ACO model. It’s a massive commitment. And if you’ve been in this space long enough, you know that CMS handing you a 10-year runway doesn’t mean you’re ready to fly.
LEAD is the successor to ACO REACH. It brings improved benchmarking that never rebases, population-based payments, healthy living flexibilities, Medicaid integration for dually eligible beneficiaries, and a new episode-based specialist risk arrangement called CARA. It’s designed to bring in organizations that have never participated in an ACO before smaller practices, rural clinics, FQHCs, specialty groups.
On paper, this is exactly what the industry has been asking for.
In practice? Most organizations that apply to LEAD will stall — not because the model is flawed, but because their operations underneath it can’t support it.
I’ve seen this movie before. I spent nearly a decade at VillageMD building value-based care operations across Medicare, Medicare Advantage, and commercial payer programs. I’ve watched organizations with great strategy, good intentions, and solid contracts fall apart operationally within 12 months. The pattern is always the same.
The model works. The Monday morning doesn’t.
Table of Contents
LEAD Raises the Stakes on Attribution
LEAD uses prospective alignment. Beneficiaries are assigned to ACOs based on their utilization patterns and primary care relationships. If your attribution data is wrong, your entire financial model is built on sand.
And I can tell you from experience…most organizations have never done a real attribution audit.
I’ve worked with groups that discovered 20-25% of their attributed panel was inaccurate. Duplicates. Misassignments. Patients who left the practice entirely but were still sitting on the roster. One organization thought it was managing 10,000 patients. After a thorough scrub, the valid number was closer to 7,800.
They spent months investing in care management for patients who weren’t even on their panel. They thought they had a care gap problem. They had a data problem.
LEAD’s benchmark structure makes this worse, not better. Your benchmark is set based on historical costs and never rebases. That’s great for stability — CMS designed it to eliminate the ratchet effect that punished efficient ACOs in prior models. But it also means if your baseline attribution is dirty, you’re locked into a benchmark that doesn’t reflect your actual population. For 10 years.
So before you submit that application by May 17…audit your attribution. Monthly, not quarterly. Remove the duplicates and inactives. Reconcile payer data against your internal systems. And assign one person — not a committee — to own attribution accuracy as an ongoing function.
Attribution is the front door to everything in LEAD. If you get that wrong, nothing downstream produces the return it should.
Fix Workflows Before You Add Flexibilities
LEAD comes loaded with new flexibilities. Benefit enhancements. Chronic disease prevention rewards where ACOs can offer healthy food to beneficiaries. Part B cost-sharing support. A Part D premium buy-down starting in 2029. Expanded medical nutrition therapy. Even a substance access beneficiary engagement incentive.
These are genuinely exciting tools. And I guarantee you…most ACOs will bolt them onto broken workflows and wonder why nothing changes.
Before you activate a single LEAD flexibility, answer three questions. Who owns this process? What data feeds it? And what actually happens on Monday morning when the team shows up?
If you can’t answer those, no new model feature is going to save you.
I worked with a clinic that mapped their care coordination process end to end. It had 14 steps. Three were duplicates. Two had no owner. The team thought they needed new software. What they needed was a whiteboard and 45 minutes.
LEAD’s healthy living flexibilities are only as good as the workflow that delivers them to patients. If you’re going to offer chronic disease prevention rewards or expanded nutrition therapy, you need a clean referral path, a clear owner at every step, and a data pipeline that tells you which patients qualify and which actually engaged.
Map one workflow. The way it actually runs today, not the way it’s documented in a binder somewhere. Identify where work stops, loops, or sits in no-man’s land. Fix it. Then decide whether technology can help scale it.
LEAD’s Specialist Integration Only Works If the Plumbing Works
One of LEAD’s biggest structural changes is CARA — CMS-Administered Risk Arrangements. This allows ACOs to set up episode-based risk arrangements with specialists and downstream provider organizations. There’s even a dedicated falls prevention program built into it.
This is CMS acknowledging what operators have known for years: ACOs can’t manage total cost of care without specialists at the table. But CARA only works if data flows between the ACO and the specialist in something close to real time.
And in most organizations? It doesn’t.
I’ve sat in rooms where the ACO had great financial data showing rising costs in a specific patient population. The specialist group managing those patients had no idea. The driver was avoidable ER visits tied to missed follow-ups — visible in the ACO’s financial reports but invisible to the care team actually seeing the patients.
They had the data. They just never connected it to action. Finance saw cost. Clinical saw quality gaps. Nobody saw the workflow gap in between.
If you’re going to use CARA, you need shared data, shared meetings, and shared goals between ACO leadership and specialist partners. Not separate scorecards. Not quarterly summaries that arrive 60 days after the fact. Real-time — or close to it — visibility into what’s driving cost and where the handoffs are breaking.
Data in LEAD Has to Drive Action, Not Dashboards
LEAD’s 10-year structure means CMS is betting on sustained performance, not quick wins. The RFA scoring criteria are telling: organizational readiness, data and health information capabilities, preventive care capacity. CMS wants to know that your data infrastructure can support a decade of performance improvement.
But here’s the thing most organizations get wrong about data. They build dashboards. Lots of them. Impressive ones. With 25 metrics nobody can explain and that no one in the room can connect to a specific decision they need to make this week.
I’ve sat in those rooms. Leadership reviewing metrics that nobody could trace back to a source, making decisions off numbers that hadn’t been validated since the report was first built. That’s not data-driven. That’s noise-driven.
For LEAD, you need a small number of metrics that describe performance clearly. Each one linked to a specific action someone can take. Validated at the source before you build reports on top of it. And reviewed weekly — not monthly. Monthly reviews in a 10-year model are autopsies. Weekly reviews are operational.
The RFA puts weight on preventive care and beneficiary experience. If you can’t show CMS that your data systems identify which patients need preventive interventions, track whether those interventions happened, and measure whether outcomes improved — you’re going to struggle in the application and struggle even more in year one.
Pilot Before You Scale — LEAD Gives You the Time
One thing LEAD actually gets right from an operator’s perspective: the implementation period. ACOs accepted under the RFA can participate in an optional implementation period from September 15, 2026 through December 31, 2026 — before the model officially launches on January 1, 2027.
Use it.
Most organizations try to scale too fast. They roll out new care models across multiple sites simultaneously, and problems multiply faster than solutions. I’ve watched regional groups launch system-wide and spend six months fixing issues across locations — burning time, budget, and team trust in the process.
The opposite approach works. Test in one clinic. One team. One region. Fix the workflow gaps early when the stakes are low and the feedback loop is tight. Then expand only when the process holds under real conditions.
LEAD’s 10-year horizon gives you something prior models didn’t: time. You don’t have to get everything right in year one. But you do have to build the foundation right. Because a foundation that cracks in year one doesn’t magically heal in year five. It compounds.
If your model only works with heavy lift and heavy subsidy in year one…that’s going to show. Over 10 years, it’s going to show loudly.
Ownership — The Thing Nobody Wants to Talk About
Shared ownership means no ownership. I see this pattern constantly and it’s one of the most expensive failures in healthcare operations.
When a process breaks and three people are supposedly responsible, what actually happens is none of them fix it. Each one assumes someone else is handling it. Tasks fall between roles. Follow-ups get missed. Data goes unchecked. And the organization bleeds time and money while the problem sits in no-man’s land.
One person. One process. That’s where accountability starts. Not a team. Not a committee. One name next to every process.
LEAD makes ownership even more critical because of the Medicaid integration component. CMS is identifying two states to develop frameworks for ACO-Medicaid partnership arrangements. If you’re in a selected state, you’ll be coordinating across Medicare and Medicaid simultaneously for dually eligible beneficiaries. That’s two payer systems, two sets of data, two sets of reporting requirements.
If nobody owns the coordination between them, it’ll fall apart fast. I’ve seen simpler integrations crater because ownership was diffused across a committee that met monthly and produced meeting notes nobody read.
Define ownership in writing. Track it in meetings. Hold owners accountable for outcomes, not activity.
Technology Comes After the Boring Stuff
I run operations at Tally, where we’re building AI-powered automation for healthcare finance. I see daily what technology can do when the operational environment supports it. I also see what happens when it doesn’t.
AI won’t fix broken processes. But it can amplify good ones. The organizations getting real value from technology right now are the ones that did the boring operational work first.
LEAD is going to attract a lot of technology investment. ACOs will be pitched analytics platforms, population health tools, care coordination software, AI-powered everything. Some of it will be genuinely useful. A lot of it will add complexity to operations that aren’t ready for it.
One team I worked with implemented a new analytics platform. Initial results were poor — not because the tool was wrong, but because the data feeding it was unreliable and the workflow for acting on its output didn’t exist. After fixing the data and building a clear response workflow, the same tool delivered real value.
Fix workflows before adding tools. Use technology to scale what already works. Avoid adding systems that duplicate existing processes. And train teams on real use cases, not theoretical capabilities.
The organizations that will win in LEAD over 10 years aren’t the ones with the best technology. They’re the ones with the cleanest operations underneath it.
The Bottom Line on LEAD
LEAD is the most ambitious ACO model CMS has ever launched. A 10-year commitment. Benchmarks that don’t rebase. Specialist integration through CARA. Healthy living flexibilities that actually address prevention. Medicaid integration for dually eligible patients. A deliberate on-ramp for organizations that have never participated in an ACO.
It is, on paper, what the industry has been asking for.
But the model will expose every operational weakness an organization has. And over 10 years, those weaknesses compound. A dirty attribution file doesn’t get better with time. A broken care coordination workflow doesn’t fix itself. A dashboard that nobody trusts in year one doesn’t suddenly become reliable in year three.
The application deadline is May 17, 2026. If you’re applying, ask yourself: Are we ready to operate this on a Monday morning? Not in a boardroom. Not on a slide deck. In the clinic, with the team, on real patients, with real data.
Start with clean attribution. Fix workflows before adding flexibilities. Assign ownership. Focus on data that drives action, not dashboards that drive confusion.
Build small. Use the implementation period. Scale only when the foundation holds.
Progress is boring. And that’s how you know it’s working. You fix one workflow. Then another. Then another. It’s not fast. But it holds.
LEAD gives you 10 years. Don’t waste the first one building on a foundation that can’t support it.
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About Steve Valdiserri
Steve Valdiserri is a healthcare operations executive and entrepreneur based in Traverse City, Michigan. He is the founder of Avanti Strategy Group, a healthcare strategy and operations firm focused on helping organizations solve real problems and realize the financial value of better execution. He serves as SVP of Operations at Tally and Accurio, where he is building the operational infrastructure for AI-powered healthcare finance. He previously spent nearly a decade at VillageMD as one of its earliest employees, building value-based care operations across Medicare, Medicare Advantage, and commercial payer programs. He completed a certificate in AI in Health Care from Harvard Medical School in October 2025 and holds a BA in Economics from DePauw University. Connect with him at stevevaldiserri.com.
