Transforming Episode Accountability Model (TEAM): What Providers Need to Know

Hospitals are preparing for the Transforming Episode Accountability Model (TEAM) as it moves from policy text to real use.

Finalized in the FY 2026 IPPS/LTCH PPS final rule, TEAM begins January 1, 2026 and runs five performance years through 2030 in selected CBSAs. 

This guide explains how the Transforming Episode Accountability Model (TEAM) aims to improve coordination and accountability across surgical episodes and how it affects payment and quality.

Key Takeaways of the Transforming Episode Accountability Model (TEAM) Include:

• TEAM runs January 1, 2026 through December 31, 2030 in selected Core-Based Statistical Areas (CBSAs). Hospitals still bill Medicare fee-for-service (FFS). After the year, CMS reconciles against risk-adjusted target prices with a quality adjustment.
• TEAM episodes begin at an anchor hospitalization or a qualifying hospital outpatient anchor procedure and end 30 days after discharge for inpatient anchors or 30 days after the anchor procedure date for outpatient anchors.
• Success in TEAM depends on the required primary-care referral at discharge, complete packets for partner providers, reliable quality validation, and an audit-ready reconciliation process.

What Is the Transforming Episode Accountability Model (TEAM)?

TEAM is a CMS Innovation Center payment model designed to improve surgical recovery, reduce avoidable costs, and raise quality by holding acute care hospitals accountable for the full 30-day episode after an anchor hospital stay or qualifying outpatient procedure.

Who’s included in the Transforming Episode Accountability Model (TEAM):

• Mandatory participants: Acute care hospitals paid under Medicare’s Inpatient Prospective Payment System (IPPS) and Outpatient Prospective Payment System (OPPS).
• Location rule: The hospital’s CMS Certification Number (CCN) primary address must be in a selected Core-Based Statistical Area (CBSA) (metro or micro area).
• One-time opt-in: CMS offered a voluntary opt-in window for certain hospitals.
• Excluded: Maryland acute care hospitals and Indian Health Service/Tribal hospitals.

To confirm whether your hospital is included in Performance Year 1, compare your CCN and primary address to the current Transforming Episode Accountability Model (TEAM) participant list and review the FAQ. 

What Are Transforming Episode Accountability Model (TEAM) Episodes?

A Transforming Episode Accountability Model (TEAM) episode is a 30-day unit of care that begins with a hospital anchor event and includes related services after the patient leaves the hospital. 

Anchors can be an inpatient stay that meets model criteria or a qualifying hospital outpatient procedure performed in the outpatient department. 

• For inpatient anchors, the episode runs from the discharge date through the 30th day after discharge
• For outpatient anchors, it runs from the procedure date through the 30th day after that date.

Services are counted when they are clinically related to the anchor condition or procedure during this window, according to CMS inclusion and exclusion rules. 

Normal Medicare fee-for-service billing continues for all providers. The Transforming Episode Accountability Model (TEAM) does not add prior authorization or change beneficiary choice. Later, CMS totals allowed amounts and applies quality scoring to reconcile against the target price.

What Services Are Included in Transforming Episode Accountability Model (TEAM) Episodes?

Transforming Episode Accountability Model (TEAM) identifies Medicare-covered services that may be counted toward the same 30-day episode. These can affect reconciliation, quality scores, and patient outcomes.

Medicare Part A settings (facility-level care that often drives the largest costs)

• Skilled nursing facility (SNF): Post-acute stays and therapy volume can swing episode spending; timely orders and therapy plans reduce avoidable days.
• Home health agency (HHA): Visit timing and care plans influence readmissions and healing outcomes reflected in quality.
• Inpatient rehabilitation facility (IRF): Intensive therapy can be appropriate; clear medical necessity and goals help avoid denials that complicate reconciliation.
• Long-term care hospital (LTCH): High-acuity stays are costly; complete documentation and early goals-of-care notes reduce length-of-stay variation.
• Hospital inpatient (related to the episode): Returns and unplanned procedures within 30 days raise episode spending and prompt quality review.

Medicare Part B items and services (professional and outpatient care that fills gaps and documents recovery)

• Hospital outpatient services: Follow-up imaging, procedures, and clinic visits; clear indications and scheduling help prevent duplicate testing.
• Outpatient therapy: PT/OT adherence supports function and lowers ED use; missing therapy documentation weakens the quality story.
• Professional services: Surgeons, hospitalists, and PCPs document continuity; timely notes support risk adjustment and quality scoring.
• Durable medical equipment (DME): Correct, on-time equipment (e.g., walkers, wound supplies) reduces avoidable ED visits and readmissions.
• Clinical laboratory services: Results guide medication changes and complication management; sharing results across settings avoids repeats.
• Part B drugs (subject to model exclusions): Infusions and injectables can be major cost drivers; clear indications and coordination with post-acute teams prevent overlaps.

Note: Inclusion and exclusion rules are exact. Use the official specifications for training and refresh examples each year so documentation and reconciliation stay aligned with the model.

How Interoperability and Care Coordination Shape Outcomes in the Transforming Episode Accountability Model (TEAM)

The Transforming Episode Accountability Model (TEAM) spans inpatient, outpatient, and post-acute settings within a 30-day window.

The model does not add a new data standard. Even so, the speed, completeness, and proof of information exchange, together with predictable handoffs, directly affect what appears in claims and how reconciliation and quality scoring turn out.

When records move quickly and completely, teams avoid duplicate tests and errors for better care coordination. Complete packets also make abstraction and appeals faster. In practice, this means:

• The whole episode is visible. Related Part A and Part B services across settings roll up to one episode total. Gaps in exchange or handoffs often become gaps in the claims history used for reconciliation.
• Proof matters. Timely acknowledgments and receipt trails show that partners had what they needed. This speeds monitoring, validation, and appeals.
• Billing and choice remain the same. Patients keep freedom of choice, and providers continue fee-for-service billing. Exchange should follow privacy and access rules while meeting TEAM’s evidence expectations.

The Transforming Episode Accountability Model (TEAM) highlights the importance of prioritizing interoperability for healthcare organizations.

What Does the Primary-Care Referral Requirement Mean in the Transforming Episode Accountability Model (TEAM)?

Hospitals must make a referral to primary care on or before discharge. If a primary care provider (PCP) is recorded on admission, refer to that established supplier. If no PCP is recorded, create a new PCP referral. Beneficiary freedom of choice applies. 

Pay close attention to:

• Auditable discharge step. The referral is part of discharge planning and should be easy to find in the chart, with the receiving clinic clearly named.
• Indirect payment effect. Early follow-up lowers avoidable returns and supports a stronger Composite Quality Score (CQS), which influences reconciliation.
• Documentation that holds up. Record who was referred, when the referral was made, and what information was sent. When available, keep confirmation from the receiving clinic that the packet was received.

The purpose is to connect the procedure or hospitalization to timely follow-up during the 30-day window, when medication checks, recovery monitoring, equipment needs, and early warning signs are addressed.

How Does TEAM Pricing and Reconciliation Affect Daily Work?

Hospitals continue to bill Medicare fee-for-service. CMS sets a target price for each episode type using baseline claims, trend, normalization, risk adjustment, and a model discount. The target is prospective and episode-specific.

After the performance year, CMS totals actual allowed spending for attributed episodes and compares it to the target. CMS then applies the Composite Quality Score (CQS). Final amounts are limited by stop-gain and stop-loss caps.

Reconciliation Steps Include:

1. CMS sets the target price for the episode category.
2. CMS applies the model discount.
3. CMS sums actual allowed spending across related Part A and Part B services.
4. CMS compares actual costs to the target and applies the CQS.
5. CMS applies stop-gain or stop-loss caps to set the final amount.

Make reconciliation routine. Keep a versioned workbook, assign named owners in finance, quality, and compliance, and archive a monthly snapshot. Maintain an inquiry log with receipts and supporting documents so questions can be answered quickly.

Which Transforming Episode Accountability Model (TEAM) Tracks Matter and How Do We Choose?

The Transforming Episode Accountability Model (TEAM) offers three tracks with different risk and quality adjustments. Pick the track that matches your performance, partners, and data strength, then record the decision with executive sign-off and board awareness.

Track 1: Upside Only in PY1

Track 1 of the Transforming Episode Accountability Model (TEAM) applies to all participants in Performance Year 1.

Some safety-net hospitals may remain longer per CMS policy. The stop-gain limit is 10 percent and there is no downside risk. Positive reconciliation amounts may receive up to a plus 10 percent Composite Quality Score (CQS) adjustment.

Use when: you need a glide path to build processes, validate episode accounting, and strengthen documentation without downside exposure.

Track 2: Limited Two-Sided Risk in PY2–PY5

Track 2 of the Transforming Episode Accountability Model (TEAM) is available in PY2 through PY5 for eligible safety-net, rural, or selected hospital types.

The stop-gain and stop-loss limits are 5 percent. The CQS can adjust positive reconciliation amounts up to plus 10 percent and negative amounts up to minus 15 percent.

Use when: you have stable post-acute partners, reliable primary care follow-up, and confidence in coding and quality capture.

Track 3: Full Two-Sided Risk Available All Years

Track 3 of the Transforming Episode Accountability Model (TEAM) is available in all performance years.

The stop-gain and stop-loss limits are 20 percent. The CQS can adjust reconciliation amounts up to plus or minus 10 percent.

Use when: your historical performance is strong, variance is low, partners are aligned, and you want access to higher upside with the ability to absorb higher downside.

Which Transforming Episode Accountability Model (TEAM) Quality Elements Matter Most for Documentation and Information Transfer?

Quality affects payment in the Transforming Episode Accountability Model (TEAM). Instead of listing every measure, focus on the parts of documentation and data flow that shape CQS and, in turn, reconciliation.

Information Transfer and Documentation Completeness

Aim for a predictable packet every time for the Transforming Episode Accountability Model (TEAM). Use consistent naming, a single episode identifier, and clear dating of operative notes, discharge summaries, and key test results.

When partners receive complete packets on time, abstraction is cleaner and downstream services are less likely to be duplicated, which protects both quality metrics and episode spending. Keep proof of transmission and receipt, since those artifacts support audits and resolve “information missing” queries quickly.

Readmission and Harm Signals

Fast, accurate notes and closed-loop follow-up reduce unplanned returns inside the 30-day window. Capture complications and interventions clearly so the clinical story matches claims.

A brief re-abstraction pass each month helps catch mismatches between documentation and coded data before they affect scoring. When a return does occur, precise documentation of cause and management can prevent misattribution.

Patient-Reported Elements (When Required)

Where patient-reported outcomes or experience are in scope, the most important move is reducing missing data. Use simple scripts, one responsible owner, and a short timeline to collect what is needed.

Note any clinical exclusions in the record so missingness is not counted against performance.

What About ACO Overlap, AAPM Status, and Program Integrity in the Transforming Episode Accountability Model (TEAM)?

The Transforming Episode Accountability Model (TEAM) is designed to coexist with other Medicare programs while keeping accountability clear. Beneficiaries aligned to an ACO can still be included in TEAM episodes, and CMS does not adjust a hospital’s TEAM reconciliation because of ACO alignment. 

On oversight, expect routine monitoring and potential audits, with a six-year records retention expectation. In practice, these points shape contracting strategy, clinician incentive planning, and audit readiness.

Key elements of the Transforming Episode Accountability Model (TEAM) include:

ACO overlap. Beneficiaries aligned to an ACO can be included in Transforming Episode Accountability Model (TEAM) episodes. CMS does not adjust a TEAM participant’s reconciliation amount based on beneficiary ACO alignment.

Advanced APM pathway. The Transforming Episode Accountability Model (TEAM) offers an Advanced APM option for Track 2 or Track 3 participants that attest to use of Certified EHR Technology (CEHRT) as specified by CMS. Clinicians still need to meet CMS’s QP thresholds to be counted as QPs for MACRA purposes; participation alone is not sufficient.

Monitoring and program integrity. CMS may request documentation, conduct site visits, and review operations. Participants must retain records for six years. Keep a ready file that shows participation status, reconciliation workbooks, quality validation, primary care referral evidence, information-exchange receipts, and responses to prior CMS inquiries.

Overlap rules prevent double-counting; the AAPM pathway may impact clinician incentives if QP thresholds are met, and strong record-keeping shortens any CMS review.

A Practical Checklist for the Next Quarter Under the Transforming Episode Accountability Model (TEAM)

1. Confirm inclusion in the Transforming Episode Accountability Model (TEAM) and file a memo with CCN, address, CBSA mapping, and sign-offs.
2. Pick a track after a simple mock reconciliation using your data and a realistic quality assumption.
3. Stand up the packet standard with clear names and two-day targets for operative notes and discharge summaries.
4. Enforce the primary-care referral at discharge and add completion to your KPI scorecard.
5. Confirm exchange pathways and receipt expectations with SNF, HHA, IRF, and therapy partners under TEAM.
6. Launch a small pre-submission re-abstraction routine; resolve issues in a weekly steering huddle.
7. Build the reconciliation workbook, archive versions monthly, and keep a running inquiry log with receipts.
8. Refresh vendor diligence and map gaps to compensating controls.

How ChartRequest Helps With the Transforming Episode Accountability Model (TEAM)

Hospitals that excel in the Transforming Episode Accountability Model (TEAM) keep information moving with speed and accuracy. The model rewards clear packets and fast confirmations.

ChartRequest supports the Transforming Episode Accountability Model with:

• Structured release of information (ROI) workflows that assemble standardized packets fast
• Timestamped receipts that prove when partners received documents
• Exportable packet inventories that drop into the reconciliation binder
• Visibility into missing items so teams can close gaps before reconciliation

The Transforming Episode Accountability Model (TEAM) rewards steady routines. With clear roles, strong packets, reliable exchange, and firm partner expectations, teams can protect quality, reduce delays, and deliver a clean, defensible reconciliation story.

Book a brief ChartRequest walkthrough to see how standardized workflows, timestamped receipts, and our industry-first 5-day turnaround time guarantee can help your organization.