Accountable Care Organizations, or ACOs, are an addition from the Affordable Care Act which attempt to streamline care in order to save the government money on health care. A development used primarily in Medicare, ACOs have been increasing in number since the National Committee for Quality Assurance (NCQA) released its list of accredited Accountable Care Organizations throughout the country in November 2011. August 2012 brought a larger number of ACOs into the picture, showing proof of increased health reform support from providers.

Many are paralleling ACOs with the introduction (and rejection) of HMOs in the 1980s and 1990s, when managed care proved too limiting for a large number of patients. Viewed as another way to limit options and restrict individuals from receiving care the way they choose to have it, ACOs are seeing some skepticism from those who remember managed care organizations getting turned down. In addition to Medicare, commercial insurance companies have begun to set up ACOs as they believe they can offer more with their existing networks and patient information databases.


What is an ACO?

ACOs are healthcare organizations that must pass the NCQA and federal requirements to deliver care under a specific model. A group of physicians and health care professionals form the ACO, offering their services to a group of patients. This payment and care delivery system attempts to connect the payment providers receive to increased quality and reduced overall cost of care. Various payment methods may be used by an ACO, including capitation and fee-for-service.

The ACO is responsible to the group of patients and the third-party payer for the quality and efficiency of their care, as well as making sure it is a necessary treatment. ACOs place much emphasis on avoiding unnecessary care in order to save money. In Medicare’s traditional fee-for-service method of payment, providers tend to get paid more when they perform a larger number of tests and procedures, which drives up costs. While ACOs will not eliminate the fee-for-service system, they are essentially trying to decrease the amount of care administered.

Providers are instead reimbursed by getting incentives for overall savings, bonuses for keeping costs down. By meeting certain quality requirements, doctors and hospitals focus on prevention and managing patients with chronic illnesses carefully. The providers’ reward comes in the more they keep patients healthy and out of the hospital.

The Centers for Medicare and Medicaid Services (CMS) named 37 groups Pioneer ACOs for successfully demonstrating an ACO model. These organizations and providers are already experienced in coordinating care for patients across care settings. To be named a Pioneer ACO, the organizations must show they have used proper quality improvement and cost-minimizing techniques in administering care for a group of patients.


Private Market ACOs

Though not as frequently mentioned as Medicare ACOs, the private sector has also embraced the ACO model to keep costs down. Jumping on board shortly after Medicare ACOs were established, several insurers began to set up their own ACOs in January 2012. Many insurers believe the potential to eliminate unnecessary costs from the healthcare system is great in the commercial market, and the flexibility given by managed care organizations will  be a greater draw for providers.

As Medicare ACOs serve 5,000 patients and must report 33 quality measures, insurers feel the same model could be applied with greater ease and efficiency on a smaller scale. With a non-Medicare payer, the number of patients may be lesser and the reporting measures not as ambitious. Also, providers assume there will be more potential bonus earnings through a private insurer’s ACO than from Medicare.

Hospitals and physicians have already been forced to experience large cuts in fees and quality reporting measures from the federal government that grow more strict and complicated. Joining a private market ACO may seem a more positive solution for providers in that case, especially compared to an entirely government-regulated system.

Using the model of a health care partnership, there is the potential for creative payment arrangements, as are other tailored contractual agreements that more correctly reflect the population and the local market. Commercial plans can also offer providers the infrastructure needed for the ACO, including administrative support tools and care management. As a certain amount of risk will be placed on the provider, most will have to learn how to build solid cost and utilization models, which existing health plans are very capable of offering.

Private plans are working to gain financially from continuing development of quality improvement in their networks under ACO contracts as a benefit to their providers. The ability to share claims and clinical data results in a more smooth transaction between payers and providers. This is the ideal outcome of setting up ACOs in the private market.


List of Current ACOs

The following is a list released from the Centers for Medicare and Medicaid Services (CMS) of the NCQA-accredited ACOs in existence throughout the country as of the most recent addition of 83 new groups last month. The map below gives an idea of how prevalent these organizations are becoming in healthcare, a very rapid growth in less than a year of development. The blue indicates the 114 ACOs starting July 1, 2012 under the CMS Shared Savings Program, and the red indicated the 37 Pioneer ACOs.


Accountable Care Coalition of Caldwell County, LLC
Accountable Care Coalition of Coastal Georgia
Serving beneficiaries in GA and SC
Accountable Care Coalition of Eastern North Carolina, LLC
Accountable Care Coalition of Greater Athens Georgia
Accountable Care Coalition of Mount Kisco, LLC
Accountable Care Coalition of the Mississippi Gulf Coast, LLC
Serving beneficiaries in the Mississippi Gulf Coast area
Accountable Care Coalition of the North Country, LLC
Accountable Care Coalition of Southeast Wisconsin, LLC
Accountable Care Coalition of Texas, Inc.
Serving beneficiaries in NJ and PA
AppleCare Medical ACO, LLC
Arizona Connected Care, LLC
Chinese Community Accountable Care Organization
CIPA Western New York IPA, doing business as Catholic Medical Partners
Coastal Carolina Quality Care, Inc.
Crystal Run Healthcare ACO, LLC
Serving beneficiaries in NY and PA
Florida Physicians Trust, LLC
Hackensack Physician-Hospital Alliance ACO, LLC
Serving beneficiaries in NJ and NY
Jackson Purchase Medical Associates, PSC
Jordan Community ACO
North Country ACO
Serving beneficiaries in NH and VT
Optimus Healthcare Partners, LLC
Physicians of Cape Cod ACO
Premier ACO Physician Network
Primary Partners, LLC
RGV ACO Health Providers, LLC
West Florida ACO, LLC
Brown & Toland Physicians
HealthCare Partners Medical Group
Heritage California ACO
Monarch HealthCare
Primecare Medical Network
Sharp HealthCare System
HealthCare Partners of Nevada
Banner Health Network
Presbyterian Healthcare Services
Physician Health Partners
Seton Health Alliance
North Texas Specialty Physicians and Texas Health Resources
Based in Fort Worth and Arlington, Texas
JSA Medical Group, a Division of HealthCare Partners
Trinity Regional Medical Center, Trimark Physician Groups (Iowa Health)
Alina Hospitals & Clinics
Fairview Health Services
Park Nicollet Health Services
Bellin Health-ThedaCare Healthcare Partners
Based in Green  Bay and Appleton, Wisconsin
OSF Healthcare System
Franciscan Alliance
University of Michigan
Michigan Pioneer ACO/Detroit Medical Center
Genesys Physician Hospital Organization
Renaissance Medical Management Co.
Bronx Accountable Healthcare Network
Atrius Health
Beth Israel Deaconess Physician Organization
Mount Auburn Cambridge Independent Practice Association
Partners HealthCare System
Steward Health Care System
Dartmouth-Hitchcock ACO
Eastern Maine Heatlhcare System
Beth Israel Deaconess Med Center: Eisenberg Ronald L
Beacon 400 LLC
Renaissance Medical Management
Plus ACO
Circle Health Alliance, LLC
Harbor Medical Associates
Coastal Medical
Concord Elliot ACO LLC
Mainehealth Accountable Care Organization
Central Maine ACO
Maine Community Accountable Care Organization, LLC
Accountable Care Coalition of Green Mountains, LLC
Barnabas Health ACO North, LLC
Chinese Community Accountable Care Organization
Asian American Accountable Care Organization
Mount Sinai Care, LLC
Independent Physicians-The
Westmed Medical Group
Pro Health Care Associates Llp
Beacon Health Partners LLC
Healthcare Provider ACO Inc.
Accountable Care Coalition of Syracuse, LLC
Chautauqua Region Assoc Medical Partners, LLC
Accountable Care Coalition of Maryland, LLC
Maryland Accountable Care Organization of Eastern Shore LLC
Maryland Accountable Care Organization of Western MD LLC
Greater Baltimore Health Alliance Physicians, LLC
Cornerstone Health Care, PA
Triad Healthcare Network, LLC
Accountable Care Coalition of the Tri-Counties, LLC
Wellstar Health Network, LLC
Accountable Care Partners, LLC
Accountable Care Coalition of Northwest Florida, LLC
Integrated Care Alliance, LLC
Bay Lake, FL 32836
FPG Healthcare, LLC
Orlando, FL 32809
Palm Beach Accountable Care Organization, LLC
Healthnet LLC
Florida Medical Clinic ACO, LLC
Allcare Options, LLC
Missionpoint Health Partners
St.Thomas Medical Group, PLLC
Anewcare Collaborative
Summit Health Solutions
Cumberland Center for Healthcare Innovation, LLC
Medical Mall Services of Mississippi
Quality Independent Physicians
Southern Kentucky Health Care Alliance
Promedica Physician Group, Inc.
University Hospitals Coordinated Care
Summa Accountable Care Organization
Mercy Health Select, LLC
Indiana University Health ACO, Inc.
Franciscan AHN ACO, LLC
Deaconess Care Integration, LLC
Oakwood Accountable Care Organization, LLC
Southeast Michigan Accountable Care, Inc.
Accountable Healthcare Alliance, PC
Iowa Health Accountable Care, L.C.
Mercy ACO
University of Iowa Affiliated Health Providers, LC
Genesis Accountable Care Organization, LLC
Prohealth Solutions, LLC
Accountable Care Coalition of Southeast Wisconson, LLC
Auroa Accountable Care Organization LLC
Dean Clinic and St.Mary’s Hospital Accountable Care Organization, LLC
Essentia Health
Advocate Physician Partners Accountable Care, Inc.
Chicago Health System ACO, LLC
BJC Healthcare ACO, LLC
Heartland Regional Medical Center
Essential Care Partners, LLC
Methodist Patient Centered ACO
Continental Credit Corporation
Texoma ACO, LLC
Memorial Herman Accountable Care Organization
Physicians ACO, LLC
BHS Accountable Care LLC
Central Utah Clinic, P.C.
John C. Lincoln Accountable Care Organization, LLC
AzPCP-ACO, A Medical Corporation, PC
Nevada Primary Care Network ACO, LLC
Meridian Holdings, Inc
Torrance Memorial Integrated Physicians, LLC
Apollomed Accountable Care Organization Inc.
North Coast Medical ACO, Inc.
John Muir Physician Network
Golden Life Healthcare LLC
North Bend Medical Center, Inc.
Polyclinic Management Services Company
Reliance Healthcare Management Soluntions, Inc.