Medicare’s newest proposed rule would pay primary care more for the complex follow up, simplify quality reporting, and cut notification paperwork. What this means for independent practices.
The proposed 2027 physician payment rule from the Centers for Medicare & Medicaid Services (CMS) shifts how CMS approaches ACO economics, providing greater incentives than ever to join an ACO. Higher baseline payment rate for ACO participants, the ability to add a significant add-on payment for care coordination services, streamlined quality reporting, a higher shared savings rate for the Basic track, and more, make this an excellent time to be a part of an ACO.
It’s important to note that this is a proposed rule, NOT final policy. CMS is accepting comments through September 14, 2026, and typically finalizes in the fall. The provisions below could change. However, CMS outlines several clear signals strengthening the Medicare Shared Savings Program (MSSP) experience.¹
Two New Ways Providers in an ACO Get Paid More
Two proposals in the rule reward primary care specifically for practicing inside an ACO. The first is an office-visit add-on. Since 2024, clinicians have billed an add-on code alongside complex visits that reflect an ongoing care relationship with the patient. For the first time, they propose a second version, billable only by clinicians in a MSSP ACO or CMS’s new LEAD ACO model, that pays twice as much (about a third of the visit’s value). It would apply as a modify to visits whose complexity warrants it: coordinating care after a hospital discharge, managing several chronic conditions at once, or following up through an assigned care coordinator.
The second is the payment rate itself. Beginning in 2026, Medicare sets two physician conversion factors. Clinicians who qualify through advanced payment models such as MSSP and LEAD get the higher of the two. For 2027, CMS proposes updating the qualifying rate by 0.75 percent against 0.25 percent for everyone else, a half-point edge that compounds year after year. Due to budget neutrality provisions, payment rates would still experience a decrease relative to 2026 unless, like last year, Congress intervenes.
Together, these changes would, if finalized, meaningfully increase fee-for-service payment for primary care delivered through an ACO.
Quality Reporting Gets Easier
CMS proposes to keep the quality reporting methods ACOs already use available longer, rather than forcing a switch. The all-payer measure-reporting option many practices invested in was scheduled to disappear after 2026; CMS now proposes to extend it into 2027 and beyond, so practices that built their workflow around it would not have to rebuild.2
Additionally, the rule adds a new electronic reporting option for practices ready to move in that direction and significantly streamlines interoperability requirements. So, practices that want to keep reporting the way they do can, and practices ready to modernize gain a cleaner path.
The measures a practice reports and the way it submits them would look much like this year, the bonus for strong quality performance stays in place, and the technology attestation ACOs complete to demonstrate interoperability gets simpler. Vytalize already manages reporting submission and measure selection on the practice’s behalf, so providers can stay focused on patient care.
A Single Deadline for Patient Notifications
Practices historically scramble each January to hand ACO notification letters to attributed patients at their first primary care visit, then track a follow-up communication within 180 days. CMS proposes to replace the first-visit trigger with a single May 30 deadline and to eliminate the follow-up notice entirely, starting in 2027,3 continuing the theme of simplification.
Higher Shared Savings and a More Stable Cost Benchmark
CMS proposes raising the shared savings rate for ACOs in the mid-level risk track from 50 to 60 percent, for agreement periods starting in 2027 representing a 10-point increase in the pool available to distribute to practices. Attribution rules would also tighten, so patient panels more accurately reflect where patients receive their primary care.
CMS is also changing how it sets the cost benchmark an ACO is measured against. The new methodology tracks real-world cost growth more closely each year and limits how far a single unusual year can move the target against the ACO. The result: shared savings become easier to predict and less vulnerable to one-off swings in cost data.
How Vytalize Is Preparing Practices for the Final Rule
Operationally, nothing changes yet. The provisions above could shift before CMS finalizes the rule this fall. In the meantime, practices already in an ACO should expect their ACO partner to model how the proposed payment changes would affect their program, and update reporting and payment systems as soon as CMS finalizes the changes.
Vytalize places each practice in the CMS program that fits its panel, and manages the model mechanics end to end, ensuring readiness for any CMS changes once finalized.
[1] Centers for Medicare & Medicaid Services, proposed rule CMS-1848-P, “CY 2027 Payment Policies under the Physician Fee Schedule and Other Changes to Part B Payment and Coverage Policies; Medicare Shared Savings Program Requirements,” scheduled for Federal Register publication July 16, 2026, federalregister.gov/d/2026-14327. Comment period closes September 14, 2026. All provisions described in this post are proposals and subject to change in the final rule.
[2] CMS-1848-P, section III.G.3 (proposed extension of the MIPS CQMs collection type and MIPS CQM reporting incentive for the APP Plus quality measure set beginning PY 2027; new Medicare eCQMs collection type) and section III.G.4 (proposed simplification of Shared Savings Program CEHRT use requirements). CMS anticipates a two-year transition period beginning PY 2028, subject to future rulemaking.
[3] CMS-1848-P, section III.G.9 (proposed revisions to 42 CFR § 425.312(a)(2): standardized written notice due by May 30 unless CMS specifies a later date; beneficiary follow-up communication requirement removed; proposed effective January 1, 2027).
