See how Medicare’s ASM reshapes payment and accountability for heart failure and low back pain care — and what it could mean for your practice.
More than 6,600 cardiologists, surgeons, pain management specialists — among others across the country — are mandated to be in a new Medicare payment model launching January 1, 2027. The Ambulatory Specialty Model (ASM) focuses on managing two chronic conditions: heart failure and low back pain.
Here’s what you need to know.
“With the Ambulatory Specialty Model finalized and the preliminary list of mandatory participants released, now is the time for physicians to plan for 2027,” said Emily Lambert, CLA physician and dental segment leader. “Seeing if you’re required to participate and preparing now for the ASM is smart business.”
What is the Ambulatory Specialty Model?
The ASM was finalized under the final 2026 calendar year physician fee schedule. It is a mandatory, two-sided risk model for physicians in certain geographies to improve the longitudinal care management of patients with heart failure or low back pain.
The model begins January 1, 2027 (first performance year) and runs for five years. Participants are scored on four performance categories and compared to their peers. Final scores are translated into positive or negative payment adjustments. The model provides a telehealth waiver and a safe harbor for collaborative care arrangements with primary care.
How were ASM participants selected?
The Centers for Medicare & Medicaid Services (CMS) selected 235 core-based statistical areas (CBSAs) or metropolitan divisions for participation, roughly 25% of the country. The ASM is mandatory for 6,6000 physicians in those geographies.
Texas tops the list with 17 geographies and 1,121 participants. California follows with 644 participants in 12 geographies, and Florida with 643 participants in 12 geographies. There are 4,000 physicians in the lower back pain cohort and 2,600 in the heart failure cohort.
According to the list of participants, the top 10 states represent 4,300 of the model’s over 6,600 participants. The bottom 10 states account for less than 100 of the model’s total participants. Wyoming and Nevada have only one participant each.
Top 10 states (by participant number)
| State | Total Participants |
|---|---|
| TX | 1121 |
| CA | 644 |
| FL | 643 |
| GA | 349 |
| NJ | 298 |
| MI | 281 |
| VA | 270 |
| NY | 251 |
| PA | 240 |
| OH | 191 |
Bottom 10 states (by participant number)
| State | Total Participants |
|---|---|
| SD | 14 |
| AZ | 11 |
| NH | 11 |
| ND | 10 |
| NM | 9 |
| VT | 7 |
| MN | 5 |
| HI | 5 |
| NV | 1 |
| WY | 1 |
Which specialties are included?
The model focuses on those who commonly treat patients in the ambulatory setting for low back pain or heart failure and who bill under Medicare Part B using these specialty codes:
| Low Back Pain | Heart Failure |
|---|---|
| Anesthesiology | Cardiology |
| Pain management | |
| Interventional pain management | |
| Neurosurgery | |
| Orthopedic surgery | |
| Physical medicine and rehabilitation |
What are the performance categories?
The ASM seeks to leverage the merit-based incentive payment program (MIPS) and MIPS value pathways. There are four performance categories:
1. Quality — Requires reporting on a fixed set of five quality measures in either cohort.
2. Cost — There is one episode-based cost measure (EBCM) required for each cohort — either the heart failure or low back pain ECBM. This is a claims-based measure.
3. Improvement activities — There are two primary care-related improvement activities required.
4. Promoting interoperability — There are multiple measures required similar to MIPS.
The quality and cost categories are reported on at the individual physician level (with exceptions) while the others are reported on at the practice level.
How are the performance categories scored?
The four performance categories will result in a composite score between 0 – 100. The quality and cost categories are each weighted at 50% each. This means performance on the improvement activities and promoting interoperability categories at best keeps your score neutral, and at worst reduces your score by up to 20 points.
Additional points are added for complex patients and those in small or solo practices.
| Performance Category | Points/Weights | Measures |
|---|---|---|
| Quality | 50% weight | 5 quality measures |
| Cost | 50% weight | 1 ECBM |
| Improvement activities | 0, -10 points or -20 points |
2 improvement activities (with sub-categories) |
| Promoting interoperability | 0 or -10 points | Multiple |
How does the model’s payment methodology work?
In the simplest explanation, physicians in selected geographies who have at least 20 Original Medicare patients attributed to them during the performance year are compared to their peers.
All scores are translated into payment adjustments of up to +/- 9% in the first year and up to +/- 12% in the final year. The adjustment is then applied to Medicare Part B covered services.
Why is Medicare focused on value models like ASM?
Read more about the forces defining health care, including significant demographic shifts and health care economics, to better understand the cost pressures on the Medicare program.
What if I’m not included in this model, should I be concerned?
In recent years, CMS has implemented more mandatory models. The expectation is that existing models could be broadened to more geographies and new models launched. Even if you are not covered by the ASM, understanding it and how risk-based models function in general will be important long-term.
What should I do next?
Start now to see if you’re in the model and if so, how to prepare for 2027.
- Check the ASM participant list
- Educate yourself on the model details and its attribution thresholds
- Review your performance on quality and cost measures under MIPS
- Assess your practice’s digital tools that help support care delivery
- Seek assistance from a trusted advisor
How CLA can help
CLA works with physician practices to translate ASM requirements into clear, workable actions across performance, reporting, and risk exposure.
We can help you confirm whether you’re required to participate and evaluate how the model may affect you. This includes understanding the attribution thresholds, reviewing potential payment adjustments under the quality and cost weighting structure, and identifying how to move forward.