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The Affordable Care Act (ACA) includes provisions directed toward physicians, hospitals and other health care providers with the goal of improving the quality, safety and affordability of health care in the United States called Accountable Care Organizations (ACO).
In general, an ACO is a type of health care payment and delivery model where a network of health care providers shares responsibility for providing care to a group of patients. ACOs are patient-centered organizations, where patients and providers work together to make care decisions. Unlike health maintenance organizations (HMOs), ACO patients are not required to receive their care in-network.
The ACO concept has existed for many years, although interest in ACOs significantly increased after the ACA became law. Under the ACA’s Medicare Shared Savings Program, an ACO is a group of providers and suppliers of health care services, including hospitals and physicians, that work together to coordinate and improve care for patients with original Medicare (not Medicare Advantage private health plans).
The will reward ACOs that lower growth in health care costs while meeting performance standards on quality of patient care.
An ACO must consist of the following types of providers and suppliers under shared governance:
- ACO professionals in group practice arrangements;
- Networks of individual practices of ACO professionals;
- Partnerships or joint venture arrangements between hospitals and ACO professionals;
- Hospitals employing ACO professionals; and
- Other Medicare providers and suppliers, as determined by HHS.