The transition is over. The Centers for Medicare and Medicaid Services (CMS) is driving full-speed into value-based care. With the new Transforming Episode Accountability Model (TEAM), the agency is accelerating the shift away from fee-for-service and requiring hospitals to focus on delivering high-quality care and improved patient outcomes.
Starting in January 2026, hospitals will be mandated to consider an entire 30-day surgical episode, from the moment a patient enters the OR through recovery and post-acute care. This means closer coordination with providers, improved discharge planning, and heightened awareness of quality metrics, including readmissions and patient outcomes.
For hospitals, this demands immediate attention – reshaping how surgical care is coordinated, documented, and analyzed.
Why TEAM changes the nature of surgical care
Historically, hospitals have managed patient care within their own walls, often failing to connect with departments or external providers. Over time, this system has led to fragmented care for patients, sometimes resulting in complications, prolonged recovery, and potentially avoidable acute care.
TEAM fundamentally changes that dynamic. Under the model, participating hospitals are accountable for the full 30-day episode of care, including post-acute services like skilled nursing facilities, home health, and general follow-up care. That means even routine post-surgical decisions can impact outcomes and reimbursement.
Financially, the stakes are high. Hospitals that control costs and deliver excellent care can earn bonus payments. Those who fall short may face penalties. In short, the framework’s effectiveness depends on stronger collaboration, cleaner data, and workflows that support consistency across settings – areas where some hospitals struggle today.
What exactly is the CMS TEAM model?
Starting January 1, 2026, CMS rolled out TEAM as a mandatory program for about 740 hospitals in selected regions. For those hospitals, there’s no opt-out.
The program runs through December 31, 2030, giving hospitals five years to adapt and optimize performance over time.
The model covers five high-impact surgical episodes:
- Lower extremity joint replacement
- Hip/femur fracture repair
- Spinal fusion
- Coronary artery bypass graft (CABG)
- Major bowel procedures
For each episode, CMS evaluates both cost and quality, using a Composite Quality Score (CQS). Performance measures include readmissions, safety events, mortality, complications, and patient-reported outcomes. Lower extremity joint replacement (LEJR) cases receive particular attention due to their reliance on post-operative care coordination.
Hospitals selected for TEAM will participate in one of three risk tracks based on eligibility:
Track 1: Upside-only risk
Designed for early participation, with no downside risk and lower levels of reward for the first year. Rural and safety-net hospitals may remain in this track for up to three years.
Track 2: Limited two-sided risk
Carries a lower risk and reward for certain TEAM participants, including safety net and rural hospitals, for years two through five.
Track 3: Full two-sided risk
Features the highest potential reward and the highest exposure across all five years.
With the shift to value-based care, small documentation gaps or coding inconsistencies can have significant financial implications.
How IMO Health helps hospitals win under TEAM
Succeeding under TEAM starts with accurate, standardized data – and that’s where IMO Health fits in. Our solutions help hospitals operationalize episode-based care by enabling:
Accurate coding and clinical terminology
IMO Health’s clinically rich terminology ensures surgical procedures are captured correctly and mapped to CPT® and HCPCS codes. That accuracy reduces billing errors and supports compliance with CMS requirements.
Smarter surgery scheduling and resource management
Detailed procedure data and case duration estimates help hospitals optimize operating room schedules and supply planning – critical drivers for controlling costs under TEAM.
Better care coordination through usable data
Structured, consistent data makes it easier to share information across care settings, track outcomes, and meet quality benchmarks that impact reimbursement.
Fewer denials and stronger revenue capture
By aligning terminology across inpatient and outpatient settings, IMO Health helps reduce authorization issues before claims are even submitted – protecting revenue while avoiding exposure to TEAM penalties.
Are you prepared?
January 2026 is here, and TEAM readiness isn’t optional. Participating hospitals must align documentation, coding, and care coordination strategies to ensure harmonized, value-based surgical care.
Ready to see how IMO Health can support your 2026 strategy?
Book a demo and discover how our solutions enable hospitals to meet challenges with ease.
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