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No Opting-Out: Navigating the Uncharted Waters of Medicare’s Ambulatory Specialty Model (ASM)

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ASM is a mandatory alternative payment model for certain specialists treating low back pain and/or heart failure, running from Jan. 1, 2027 through Dec. 31, 2033, and applies to individual clinicians who meet CMS’s eligibility criteria. 

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Medicare Part B payments for covered professional services will be adjusted up or down using a payment multiplier derived from each clinician’s ASM performance score.

Clinicians should prepare now by familiarizing themselves with the participation requirements, enhancing care coordination, upgrading technology, and training staff to meet reporting and interoperability requirements. 

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On Oct. 31, the Centers for Medicare &amp; Medicaid Services (CMS) released the 2026 Medicare Physician Fee Schedule Final Rule, wherein it established the Ambulatory Specialty Model (ASM) – a mandatory alternative payment model for medical specialists who treat patients with low back pain and/or heart failure. The ASM is designed to test whether adjusting payment for such specialists – based on their performance on targeted measures of quality, cost, care coordination and meaningful use of certified electronic health record technology (CEHRT) – can enhance quality of care and reduce costs, particularly through more-effective management of chronic conditions. The model draws on the Merit-Based Incentive Payment System (MIPS) framework and will run for seven years, from Jan. 1, 2027, to Dec. 31, 2033.

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Who Will Be Required To Participate

The ASM will apply to certain individual clinicians (not to groups or organizations) who treat patients with low back pain and/or heart failure. CMS will identify eligible ASM participants annually using data from two years prior to the performance year, and participants will be exempt from MIPS reporting for any ASM performance year. A clinician will be required to participate in the ASM if they meet all the following criteria:

Medicare Billing: The clinician bills claims under the Medicare Physician Fee Schedule.

Specialty Type: The clinician has one of the following Medicare Part B specialty codes indicated on the plurality of their Medicare Part B claims: Cardiology, Anesthesiology, Interventional Pain Management, Neurosurgery, Orthopedic Surgery, Pain Management, Physical Medicine or Rehabilitation.

Episode Volume: The clinician meets the episode-based cost measure (EBCM) episode volume threshold for the targeted chronic condition (at least 20 episodes of either low back pain or heart failure two years prior to the performance year).

Geographic Location: The clinician is located in one of the mandatory geographic areas (select core-based statistical areas or metropolitan divisions) chosen by CMS for participation.

ASM Performance Assessment

CMS will measure performance in the ASM using a four-category structure, similar to the four established MIPS performance categories, with a focus on low back pain and heart failure:

Quality: Condition-specific mandatory measures for low back pain (e.g., high-risk medication use, depression screening, body mass index screening, functional status change) and for heart failure (e.g., unplanned admission rates, beta blocker therapy, ACE/ARB/ARNI therapies, blood pressure control, functional status assessments)

Cost: EBCMs for low back pain and heart failure

Improvement Activities: Required activities such as connecting to primary care, health-related social needs screening and collaborative care arrangements with primary care providers

Promoting Interoperability: Use of CEHRT and reporting on MIPS’ Promoting Interoperability objectives and measures

Each clinician will receive a performance score based on these categories, with quality and cost each weighted at 50 percent of the final score and adjustments for improvement activities and interoperability.

For covered professional services furnished by participating clinicians, CMS will multiply the amount otherwise paid under Medicare Part B for such covered professional services by a payment multiplier calculated for the individual ASM participant. The payment multiplier is calculated using the clinician’s final score under the ASM performance assessment above (through a logistic exchange function).

Depending on the clinician’s performance under the ASM performance assessment (and subject to certain other factors such as varying maximum risk levels), payments for covered professional services may be increased or decreased when the payment multiplier is applied.

Understand ASM Participation and Eligibility: ASM participation is mandatory if certain eligibility criteria are met; clinicians do not have the ability to opt out.

Become Familiar with ASM Performance Categories and Measures: ASM performance is assessed across different categories (quality, cost, improvement activities and promoting interoperability), each with specific reporting and improvement requirements.

Prepare for Data Submission and Reporting: The ASM contains specific data submission and reporting requirements that are estimated to take approximately 24 hours per year per participant.

Enhance Care Coordination and Collaboration: A clinician’s final score under the ASM performance assessment is adjusted for their participation in certain improvement activities such as connection to primary care and establishment of collaborative care arrangements.

Optimize IT and CEHRT Capabilities: Both physicians and their employers should ensure systems are updated and capable of supporting ASM reporting and interoperability requirements.

Educate and Train Staff: CMS will provide resources in 2026 to help participants prepare, and staff should be trained on new reporting requirements, care coordination activities and workflows.

Understand Payment Adjustments and Incentives: Future Medicare Part B payments will be adjusted based on ASM performance.

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