Proposed CY 2026 Medicare Physician Fee Schedule: Key changes impacting the Medicare Shared Savings Program

On July 14, 2025, the Centers for Medicare and Medicaid Services (CMS) released the 2026 calendar year (CY 2026) Medicare Physician Fee Schedule (Proposed Rule). Among the many changes proposed, the Proposed Rule includes potential changes to the Medicare Shared Savings Program (MSSP). Comments on the Proposed Rule, including the MSSP-specific proposals, are due by 5pm ET on September 12, 2025.

The Proposed Rule’s changes to the MSSP target several components of the program, including:

• Accelerating transition to higher risk levels for MSSP accountable care organizations (ACOs)
• Creating flexibility for newer ACOs that fall below the minimum requirement of 5,000 assigned beneficiaries (although these ACOs may face lower caps on potential shared savings and losses while being excluded from the availability of certain shared savings options for low-revenue ACOs)
• Revising the list of primary care services used for beneficiary assignment, and
• Modifying the MSSP’s quality performance standards and other quality reporting requirements. 

While each of the MSSP-related proposals has the potential to materially impact new or existing ACOs, two of these proposals warrant particular attention: (1) proposed mid-year ACO participant changes of ownership (CHOW) requests, and (2) proposed expansion of the MSSP automatic extreme and uncontrollable circumstances (EUC) policies to cyberattacks.

Impact of proposed mid-year ACO participant CHOW requests

Under existing rules, MSSP ACOs are required to maintain, update, and submit lists of their participating providers to CMS. The list plays a key role in the MSSP, including determining beneficiary assignment, ACO eligibility, low- and high-revenue ACOs, financial calculations, and submission of quality data.

While ACOs must also notify CMS promptly of any CHOWs of their participants, CMS only permits changes to the list during the annual change request cycle. If approved, the change is only effective for the next performance year. As a result, the ACO’s participation, financial results, and obligations are based on a static list, regardless of any material changes to its participant network.

Under the Proposed Rule, ACOs would be required to submit CHOW requests outside of the annual cycle when the surviving Medicare-enrolled tax identification number (TIN) has no Medicare billing claims history (ie, the TIN has no paid claims for prior benchmark or performance years). If the CHOW request is approved, CMS proposes to incorporate the surviving TIN into the ACO’s assignment, historical benchmark, performance-year financial calculations, and the ACO’s obligation to report quality data on behalf of eligible professionals who bill under the TIN.

CMS believes the mid-year change could result in the surviving TIN maintaining its status as an ACO participant while retaining its assigned beneficiaries. For the ACO, the proposal could materially impact its reporting obligations under the Quality Payment Program (QPP), among other aspects of its MSSP participation.

Of note, CMS expressly opted not to propose allowing CHOW requests for all mid-year changes (ie, including surviving TINs with Medicare billing claims history). CMS was concerned that allowing all requests would create too large of a discrepancy between the benchmark year patient population and the performance year patient population.

However, the proposed changes could result in an ACO having to complete two filings to CMS when mid-year CHOWs occur, each of which would need to be carefully crafted to avoid unnecessary negative consequences for the ACO.

First, the ACO would be required to file the out-of-cycle CHOW change request. As proposed, that request would need to follow yet-to-be-determined requirements and include certain supporting documents demonstrating the CHOW (eg, bill of sale, joinder agreement, or certain other legal documents, potentially including an affidavit describing the CHOW).

Second, one or more out-of-cycle CHOW requests may constitute a “significant change” under the MSSP rules. In that circumstance, ACOs may have an obligation to notify CMS in accordance with those rules. Any significant change could adversely affect the ACO’s participation in the MSSP, particularly if the change causes the ACO to no longer meet the MSSP eligibility or requirements.

If finalized, ACOs are encouraged to begin assessing their participant agreements and policies to confirm that they contain the right terms and procedures to address mid-year CHOWs and to mitigate the risks presented by the impact of the CHOWs. Crafting the notices and gathering the relevant supporting materials will be key to the success or failure of any CHOW request or any significant change notice.

In a related proposal, CMS has also proposed a new mechanism for ACOs to submit modifications to their SNF affiliate list during a performance year to allow a surviving TIN that was not on the approved list to continue participating in the SNF three-day rule waiver.

Expanding quality and finance EUC policies to cover cyberattacks

Since 2017, CMS has applied its quality and finance EUC policies to ACOs affected by natural disasters and, more recently, to public health emergencies. The determination regarding an EUC is made under the QPP and adjusts how an ACO’s quality performance scores and financial liabilities are calculated.

Under the Proposed Rule, CMS acknowledges that the MSSP rules do not “unambiguously” address the applicability of the EUC policies to ACOs affected by a cyberattack, including ransomware and malware. Whereas natural disasters and the public health emergency impact an entire region or locale, CMS also noted a need to have the EUC policies account for an ACO “at the legal entity level” due to a cyberattack.

As proposed, an ACO affected at the legal entity level by an EUC due to a cyberattack may submit a “MIPS EUC Exception” application to the QPP as an alternative payment model (APM) entity for the affected performance year. If the application is approved, CMS would apply the EUC policies to adjust how the ACO’s quality scores are measured and to mitigate shared losses for the affected performance year.

The Proposed Rule includes additional details on revisions to the EUC policies, the exception application process, adjustments to the quality score requirements, and the calculation and reduction of shared losses.

Learn more

For more information about the MSSP-specific proposals under the Proposed Rule or to discuss the submission of comments to the Proposed Rule, please contact the authors of this alert or any member of our Healthcare Regulatory practice group.