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Accountable care organizations

An accountable care organization (ACO) is a group of doctors, hospitals and health care providers who work together to provide higher-quality coordinated care to their patients, while helping to slow health care cost growth. It is characterized by a payment and care delivery model that seeks to tie provider reimbursements to quality metrics and reductions in the total cost of care for an assigned population of patients.

The ACO may use a range of payment models capitation, fee-for-service or bundled payments, etc.). The ACO is accountable to the patients and the third-party payer for the quality, appropriateness and efficiency of the health care provided. According to the Centers for Medicare and Medicaid Services (CMS), an ACO is “an organization of health care providers that agrees to be accountable for the quality, cost, and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program who are assigned to it.”

The success of the ACO model in fostering clinical excellence while simultaneously controlling costs depends on its ability to “incentivize hospitals, physicians, post-acute care facilities, and other providers involved to form linkages and facilitate coordination of care delivery, according to A National Strategy to put Accountable Care into Practice. Health Affairs by Dr. Mark McClellan, former administrator of the Centers for Medicare & Medicaid Services (CMS) and former commissioner of the U.S. Food and Drug Administration (FDA). By increasing care coordination, ACOs can help reduce unnecessary medical care and improve health outcomes, leading to a decrease in utilization of acute care services.

Healthcare quality delivered by an ACO is defined by CMS via five domains. They are “patient/caregiver experience, care coordination, patient safety, preventative health, and at-risk population/frail elderly health.”

An ACO’s patient population will primarily consist of Medicare beneficiaries. In larger and more integrated ACOs, the patient population may also include those who are homeless and uninsured. Patients may play a role in the healthcare they receive from their ACOs by participating in their ACO’s decision-making processes.

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