Preparing for the Future of PACE Audits: A Deep Dive into the Updated 2026 CMS PACE Audit Protocol

The Centers for Medicare & Medicaid Services (CMS) has finalized the 2026 PACE Audit Protocol, PACE Audits | CMS, marking one of the most significant changes to PACE auditing in recent years. These revisions are designed to align the protocol with new regulatory requirements that took effect in June 2024 and incorporate lessons learned from CMS audit activity in 2023 and 2024.

PACE Organizations (POs) will need to understand not just what has changed, but why these changes matter—and how they directly affect audit preparation, staffing, documentation quality, and internal oversight. With CMS estimating that the revised protocol requires approximately 671 hours of PO staff time per audit cycle, preparation is now more critical than ever. This article breaks down each major update in the new protocol and provides guidance on how PACE Organizations can prepare themselves for successful audit outcomes in 2026 and beyond.

A Shift Toward Standardization, Consistency, and Regulatory Alignment

The 2026 PACE Audit Protocol reflects two core objectives:

1. Implementation of new regulatory provisions effective June 2024
2. Integration of lessons learned from CMS audits conducted in 2023 and 2024

CMS clearly states that these updates were designed to improve consistency and transparency while reducing unnecessary burden on PACE Organizations. Among the most significant changes are updates to data requests and compliance standards. These were revised to align with updated federal regulations, meaning that POs must review and, in many cases, restructure internal workflows to ensure compliance. For POs that have not reassessed their monitoring systems, documentation protocols, or universe generation logic in the past year, these changes represent a critical call to action.

Case File Cover Sheets: More Structure, Better Navigation

One of the most notable additions is the new case file cover sheet requirement. Every sample case file submitted must now include a standardized cover sheet designed to improve reviewer navigation and ensure files are complete, properly organized, and clearly marked. From a compliance readiness perspective, this change is significant. Case files often span multiple documents, systems, and sources. The new cover sheet essentially acts as:

• A checklist of required documentation
• A quality control tool ensuring documents are comprehensive and cohesive
• A navigation map for auditors

The practical benefit? Reduced back and forth during audits. The operational requirement? More disciplined documentation and case management protocols within the PO.

Seven New Impact Analysis Templates: Stronger Root Cause Insights

CMS has also introduced seven new Impact Analysis (IA) templates. These are used when deficiencies are identified during an audit and aim to:

• Standardize the assessment of non compliance
• Ensure POs can articulate the scope, scale, and participant impact of issues
• Provide a structured method for reporting corrective actions

These new templates significantly elevate expectations for internal analytics, documentation accuracy, and operational transparency. Because these templates are only required when deficiencies arise, well prepared POs with strong internal monitoring can minimize their exposure. Still, POs should ensure readiness by:

• Training staff on IA requirements
• Creating a document library for rapid IA completion
• Strengthening internal audit functions to catch issues upstream

Improved IA structure is a win for both CMS and POs—if organizations put in the work now to understand the templates and populate them properly.

RAI and CAP Templates: CMS Standardizes Audit Interactions

In a move toward greater uniformity and clarity, CMS has introduced new templates for responding to Requests for Additional Information (RAIs) and for submitting Corrective Action Plans (CAPs). These templates now serve as the required method for submitting information back to auditors. This new structure ensures:

• More consistent information across POs
• Clearer expectations for what constitutes an adequate response
• Easier CMS review and comparison
• Reduced confusion around formatting and content

But it also creates new operational demands. RAIs often come with short turnaround times. CAPs must reflect not only remediation but also root cause level preventive controls. POs must ensure their Compliance and Quality teams are comfortable with these templates, understand the required detail, and have the internal infrastructure to meet time sensitive requests.

Elimination of Burdensome Data Collections: A Welcome Update

CMS eliminated several burdensome reporting requirements from the 2023 protocol; a change intended to reduce strain on PACE staff and streamline timelines for audit closure. According to CMS and industry summaries, removed requirements include:

• Certain monitoring reports
• Specific CAP monitoring submissions
• Some internal process documentation deemed overly resource intensive

This reduction in burden does not change CMS’s expectations—it simply allows POs to focus on high value data and documentation related to compliance and participant safety.

Importance of PACE Universes

A critical theme embedded across the protocol updates is the importance of universe accuracy. The universe is the foundation of a CMS audit, and errors—whether due to missing fields, incorrect logic, inconsistent definitions, or system limitations—are among the fastest ways for POs to encounter early audit challenges.
CMS’s revisions underscore the expectation that POs:

• Understand the updated data definitions
• Validate all underlying system logic
• Have cross functional ownership between clinical, operational, and data teams
• Maintain processes for regular universe testing prior to audits

Given that inaccurate universes often lead to expanded audits, increased scrutiny, and additional sample requests, POs cannot afford to overlook this foundational requirement.

Understanding the Burden Estimate: 671 Hours

CMS’s supporting documentation indicates that the 2026 protocol represents an estimated 671 hours of PO staff time to complete—a substantial but realistic reflection of modern audit demands.

This time includes:

• Preparing universe data
• Assembling and performing quality review of sample files
• Completing impact analyses
• Responding to RAIs
• Drafting and submitting CAPs
• Coordinating documentation across departments

While the new templates and the removal of some burdensome requirements aim to streamline the process, the overall need for cross departmental alignment remains high.

Final Thoughts: Preparation Is the Greatest Predictor of Audit Success

The updated 2026 PACE Audit Protocol raises both the bar and the opportunity for PACE Organizations. With clearer instructions, standardized templates, and more structured expectations, CMS is helping POs understand exactly what is required—but it is up to each organization to prepare accordingly. By understanding the universes, adapting to the new templates, and strengthening internal oversight now, POs will be well positioned to navigate audits confidently and effectively.