The CY2027 Proposed Rule for MSSP ACOs: What Changes, What It Pays, and What We're Telling CMS
Quality reporting relief, a new collection type decision with real money attached, the first serious fix to the benchmark ratchet in a decade, and a 32% payment modifier available only to ACO participants.
The 2027 Physician Fee Schedule proposed rule is the most consequential rule for Shared Savings Program ACOs in years: quality reporting relief, a new collection type decision with real money attached, the first serious fix to the benchmark ratchet in a decade, and a 32% payment modifier available only to ACO participants. Here is what CMS proposed, what it means operationally, and where VBCA stands.
CMS released the CY2027 Physician Fee Schedule proposed rule (CMS-1848-P) on July 14. Everything below is a proposal subject to a 60-day comment period; comments are due September 14, 2026, with a final rule expected around November and most provisions effective January 1, 2027. VBCA is drafting formal comments, and as we develop them we are gathering input from clinicians and ACOs across our community. If a proposal below would hit your organization in a way CMS should hear about, we want it in our letter.
This is the MSSP deep dive in our CY2027 series; the overview and the other audience-specific analyses live on our proposed rule hub page.
PY2027: The APP Plus Measure Set Drops to Eight Measures
CMS proposes to remove measure 305 (Initiation and Engagement of SUD Treatment) and measure 493 (Adult Immunization Status) from the APP Plus set beginning PY2027. Neither measure has ever been reported: under current policy, 305 enters the set in 2027 and 493 in 2028 or later. In practice, this cancels the SUD reporting build ACOs would otherwise be standing up this fall, including new-episode identification and the 14-day initiation windows, and it takes the immunization data work behind 493 off the roadmap with it.
Where we stand: We will support the removal in our comment letter. Both measures would have imposed substantial data infrastructure before either had demonstrated it could be reliably reported at the ACO level, and 493 depends on an eCQM specification that still does not exist. Nothing currently measured goes away, and the remaining eight measures stay fully aligned with the Universal Foundation, which should give the set some stability going forward.
PY2027: MIPS CQMs Survive, and a New Medicare eCQM Collection Type Arrives
Two proposals here could shape every ACO's PY2027 reporting strategy. First, CMS proposes to extend the MIPS CQM collection type and its reporting incentive beyond PY2026, when both are currently set to end, which removes the forced conversion to the remaining collection types. Second, CMS proposes a new “Medicare eCQM” collection type: it mirrors the existing eCQM specifications but runs the measure population against the ACO's assigned beneficiary list instead of the all-payer, all-patient population the existing eCQM type requires. The Medicare eCQM and Medicare CQM collection types would be scored on flat benchmarks, and for measures 001, 134, and 236 the flat benchmark would apply retroactively to 2026 when reported via Medicare CQMs. ACOs retain the ability to mix collection types across the five clinical quality measures.
The catch sits in one sentence of the rule: Medicare eCQMs would be ineligible for the Complex Organization Adjustment and the reporting incentive available to the existing eCQM collection type. The option potentially solves the all-payer aggregation problem, but it gives up scoring support in exchange. Whether that trade is worth it is a math question, not a philosophy question, and the answer can differ from one ACO to the next.
Where we stand: We support both proposals, with one caveat we intend to raise. The ACOs that most need an assigned-population reporting option are complex, multi-TIN, multi-EMR organizations, which is exactly who the Complex Organization Adjustment exists to support. CMS's stated rationale for the exclusion is that the adjustment compensates for the complexity of all-payer reporting, but the complexity these organizations face is not the payer mix; it is aggregating data across many TINs and EMRs, and that burden is identical whether the population is all-payer or Medicare-only. We plan to ask CMS to extend the adjustment to Medicare eCQMs on that basis.
Our platform models this trade-off per ACO before the reporting period opens, so the collection-type selection rests on numbers rather than instinct. We are running it for our ACO clients now; if you want yours run, talk to us.
PY2026: Data Completeness Relief
Beginning with PY2026, an ACO could exclude a participant TIN from a measure's submission under specified circumstances, such as an unexpected practice closure or a specialty EMR that cannot support the measure, provided the remaining TINs cover at least 95% of assigned beneficiaries. The 75% data completeness requirement would still apply to each measure submitted. For multi-TIN ACOs, this means one non-reporting TIN can no longer compromise an entire measure, under any of the four collection types.
Where we stand: This is one of our strongest support items and will be a headline in our letter. Today a reporting failure at a single TIN, for reasons entirely outside the ACO's control, can jeopardize the quality performance standard for the whole organization, and that penalty has never been proportionate to the problem. Our one ask concerns the open-ended category: “other circumstances as determined by CMS” needs defined criteria and a predictable process, because relief an ACO cannot rely on in advance is not relief, it is an audit argument after the fact.
PY2027: The CEHRT Use Requirement Is Restructured
CMS proposes to sunset the requirement that ACOs report all MIPS Promoting Interoperability measures starting in PY2027. In its place, an ACO would complete one of three activities: report at least one of the five clinical measures via eCQM or Medicare eCQM; report at least one measure using CEHRT and attest to using a FHIR-based API through a certified Health IT Module; or attest to one ACO-level metric (e-prescribing, health information exchange, or patient electronic access), each built as “at least one provider in every participating TIN,” with allowable TIN exclusions documented for audit.
An ACO that lands on Medicare eCQMs above satisfies the first option automatically, which is the cleanest path. The rule also includes a request for information on applying electronic prior authorization to ACOs in future years; nothing is required yet, but it signals alignment with the electronic prior authorization requirements arriving on the MIPS side.
Where we stand: We support the restructuring; it is real simplification. We will be watching implementation closely, because EMR vendors interpret CEHRT requirements differently, and the audit exposure for a per-TIN attestation sits with the ACO rather than the vendor. Concrete configuration guidance and vendor conformance review belong in the final policy.
PY2026: Enforcement Relief on the Current CEHRT and PI Requirements
Tucked inside the proposed rule, CMS gave notice that it is extending its PY2025 enforcement discretion to PY2026 on the MSSP Promoting Interoperability reporting requirement. CMS states explicitly that it will not take compliance action against an ACO that does not meet the current CEHRT use and related PI requirements for PY2026, and that there is no impact on the ACO's ability to earn or receive shared savings.
Two footnotes. This is enforcement discretion announced in a proposed rule, not codified regulation, so it should hold but is not guaranteed text. And the underlying requirements technically remain on the books for PY2026; the discretion forgives noncompliance rather than deleting the obligation.
PY2027: The Financial Methodology Package
CMS is proposing six changes to how benchmarks and shared savings are calculated. In plain terms:
- The sharing rate for BASIC Level E ACOs is proposed to increase from 50% to 60% of gross savings. The downside is proposed to remain at 30%.
- The regional benchmark weight is proposed to be reduced from 50% to 35%. This will result in a reduced benchmark value for ENHANCED track ACOs whose spending runs below their regional average, since the boost from that difference would carry less weight. Higher-spending ACOs and the entire BASIC track are unaffected. This reduces the benefit to ACOs when enrolling participants whose expenditures are already at or below baseline compared to their regional peers.
- The prior savings adjustment is proposed to increase from 50% to 75%. When CMS rebases a benchmark, the ACO's own earned savings have lowered its historical spending, which drags the new benchmark down; this adjustment counteracts that by adding a portion of prior savings back into the rebased benchmark. Raising the add-back from half to three quarters means an ACO gives back less of its benchmark for having performed well.
- The 5% cap on upward benchmark adjustments is proposed to become risk-adjusted. This will result in more headroom for ACOs with sicker populations, since the cap would reflect actual case mix instead of treating every population as average.
- A new growth adjustment to the benchmark is proposed for ACOs that recruit clinicians and beneficiaries new to value-based care. This will result in an additional upward benchmark adjustment that rewards expanding the program's reach.
- A guardrail is proposed to keep the ACPT within 1 point below and 1.5 points above actual national growth. This will result in protection against CMS's own projection error: one third of the annual benchmark update is a forecast fixed years in advance, and when it under-projects, ACOs lose savings through no fault of their own, as recent cohorts did.
Two timing points matter. The Level E and regional adjustment changes apply only to agreement periods beginning on or after January 1, 2027, so existing ACOs see them at renewal, not mid-agreement. Applications for a January 1, 2027 start have already closed; CMS plans to give those applicants a time-limited window after the final rule to change their BASIC or ENHANCED selection, and an ACO that did not apply would next enter a new agreement period on January 1, 2028.
The ACPT guardrail comes with news many ACOs have not yet registered: CMS is delaying PY2025 financial reconciliation. Results are now planned for November 2026, with payments in December, later than the timeline ACOs are used to. The reason is the guardrail itself: CMS proposes to apply the protective lower bound retroactively to ACOs that started in 2024 through 2026, and it is holding the PY2025 run until after the final rule so the correction can be applied to it. By CMS's own description, every ACO covered by the retroactive fix either benefits from it or is unaffected. If your ACO started in those years, the wait should come with a better result.
One more consequence of track: only BASIC Level E and ENHANCED count as Advanced APMs, so only participants in those tracks can reach QP status and the higher QP conversion factor. Per the rule itself, 74% of MSSP ACOs are already in those two tracks. You will see the QP distinction show up in the payment table below.
Where we stand: We support the package; it is the first serious attempt in a decade to fix the long-standing problem of ACOs' benchmarks falling because they performed well. The one piece where we are holding our position is the regional adjustment reduction, which for a lower-spending ENHANCED ACO is a benchmark cut at renewal. If that describes your ACO, we want to hear from you before we finalize our comment.
CY2027: G2211 Becomes Two Payment Modifiers, and the Second One Is ACO-Only
CMS proposes to retire the G2211 add-on code, currently a flat payment of roughly $16, and replace it with two modifiers on qualifying office and outpatient E/M visits. The first adds 16% to the base E/M payment and is available to all practitioners. The second adds 32% and is available only to practitioners on an MSSP ACO participant list (any track or level) or in the new LEAD model; participant-list status is the only requirement. It can be billed for every Medicare patient the practitioner treats, not just assigned beneficiaries, and G2211's longitudinal-care criteria carry over, so ongoing management of a serious or complex condition qualifies. That includes the chronic-condition specialist relationships that drive attribution in many ACOs, not just primary care.
One limitation carries over from G2211: neither modifier is payable on a visit billed with modifier 25 alongside a procedure (annual wellness visits, vaccines, and Part B preventive services are the only exceptions), so same-day office procedures earn no modifier. CMS is seeking comment on whether to relax this for global-period procedure days, and we intend to weigh in.
To make the stakes concrete, here is the stacked 2027 impact for an illustrative office-based practice:
| 2027 proposed change vs. 2026 | Outside any ACO | ACO participant | ACO participant with QP status* |
|---|---|---|---|
| Conversion factor | −$16,800 | −$16,800 | −$11,900 |
| G2211 to modifier (net vs. today) | +$5,800 | +$49,900 | +$49,900 |
| Same-day E/M + global-period procedure cut | −$10,500 | −$10,500 | −$10,500 |
| Stacked total | −$21,500 | +$22,600 | +$27,500 |
*Assumptions: $1M in Medicare allowed charges; roughly 2,400 visits qualifying for the longitudinal modifier at an average base E/M payment of ~$115; roughly 300 same-day E/M-plus-minor-procedure encounters. QP status is available only in Level E or ENHANCED, only when the clinician clears the year's statutory thresholds, and, as proposed, only at the participating TIN. Actual results vary with E/M share and same-day procedure patterns.
The same illustrative practice swings from a $21,500 loss outside an ACO to a $22,600 gain inside one, and nearly all of that comes from participant-list status alone; QP status adds the last $4,900.
For the ACO itself, there is a second-order effect worth planning for. The modifier claims count in assignment calculations, benchmarks, and performance-year spending. In the early years, the added spend hits performance-year expenditures before benchmarks reflect it; we estimate that transition effect at 0.3 to 0.5% of total cost of care. Against minimum savings rates of 2.0 to 3.9%, that is a meaningful piece of the savings hurdle in the early years.
Where we stand: We support the proposal and will raise two issues. First, CMS already maintains the participant lists that define who qualifies, so it should apply the ACO differential from those lists rather than through claim-by-claim modifier logic that turns a policy benefit into a billing-competence test. Second, CMS should address the benchmark transition in the trend methodology rather than leaving early adopters to absorb it. And a practical note for every ACO: audit current G2211 utilization across your participants now, because any under-billing today becomes twice as expensive under a percentage structure.
Additional Provisions Worth Knowing
Approved ACOs could reduce or eliminate beneficiary Part B cost sharing through participant arrangements, targeted to start April 1, 2027; used well, that is a screening follow-through tool for measures 112 and 113. Beneficiary notification simplifies to a single standardized notice due by May 30. On assignment, advance care planning, SBIRT, and vaccine adverse effects management codes join the definition for PY2027, and beginning PY2028, primary care billed through non-ACO TINs would be excluded. On CAHPS there is nothing new; the web-mail-phone administration finalized last cycle takes effect for PY2027 as planned.
Two requests for information deserve every ACO's attention. CMS is soliciting comment on prospective primary care payment within MSSP, the largest structural change the program has contemplated since inception. A separate RFI asks how to better integrate specialty care into the program, including attribution, benchmarking, and specialist performance measurement; CMS notes specialists are 65% of participating physicians and roughly 80% of Part B physician spend. If your ACO's attribution runs through specialists, that RFI is effectively about your model.
What to Do Before September 14
Comments are due September 14, 2026, and this is a rule where comments genuinely matter: the collection-type mechanics, the modifier administration, and both RFIs are exactly the kinds of proposals CMS refines in response to specific, operational input. VBCA submits formal comments each cycle, and we are building this letter from what our community tells us. If any of these proposals would hit your ACO in a way CMS should hear about, tell us and we will carry it into the letter. And if you want the numbers behind any decision here, the collection-type trade-off, the modifier expenditure effect, or your own participants' G2211 audit, we are running those models now.
This analysis is part of our CY2027 proposed rule series. See the hub page for the overview; the deep dives for MIPS practices, the 2027 payment math, and hospital-based clinicians are rolling out through the comment window.