

Accountable Care Organizations (ACOs)
What Are Accountable Care Organizations (ACOs)?
Accountable Care Organizations are groups of clinicians, hospitals and other health care providers who come together voluntarily to give coordinated high-quality care a designated group of patients. While some private plans have contracted with ACOs, this page refers mainly to Medicare ACOs.
Coordinated care seeks to ensure that patients, especially the chronically ill, get the right care at the right time, while avoiding unnecessary duplication of services and preventing medical errors. Under Medicare, when an ACO succeeds both in delivering high-quality care and spending health care dollars more wisely, it will share in the savings it achieves for the Medicare program.
The ACO model was included in national health care reform legislation as one of several demonstration programs to be administered by the Centers for Medicare & Medicaid Services (CMS). Participating ACOs assume accountability for improving the quality and cost of care for a defined patient population of Medicare beneficiaries. ACOs in turn receive part of any savings generated from care coordination as long as quality was also maintained.
Medicare offers several different types of ACO programs:
Key Resources
CMS Reports record participation in ACOs this year — A record 480 accountable care organizations will participate in the Medicare Shared Savings Program in 2024, including 19 thatwill participate in the new permanent payment option, the Centers for Medicare & Medicaid Services announced Jan. 29.
ACO REACH Modifications — The Centers for Medicare & Medicaid Services Aug. 14 announced changes to its Accountable Care Organization Realizing Equity, Access, and Community Health Model starting in performance year 2024 to advance health equity and make the model more predictable for participants and more consistent with other CMS programs and models.
Medicare to launch primary care model for low-revenue ACOs — The Centers for Medicare & Medicaid Services expects to launch a voluntary primary care model in January 2025 for low-revenue accountable care organizations that participate in the Medicare Shared Savings Program.