ACOs: Making Good Care Count

The Centers for Medicare & Medicaid Services (CMS), an agency within the Department of Health & Human Services (HHS), implemented Accountable Care Organizations (ACO) as part of the provisions Affordable Care Act (ACA).

Why were ACOs created?

An ACO is designed to facilitate the treatment of patients across a variety of care settings like doctor’s offices, hospitals and long-term care facilities by their health care providers.






Rules the ACO must follow:

Each ACO is required to establish a governing body representing its providers and Medicare beneficiaries.

The ACO is responsible for routine care self-assessment, monitoring, and reporting. The information is used to continually improve the care delivered to their Medicare beneficiaries.








What is the relationship between an ACO and the Medicare Shared Savings Program?

ACOs that lower health care spending and meet or exceed the performance standards on quality of patient care will receive financial incentives through the Shared Savings Program.

How does an ACO become a partner in the Shared Savings Program?

A prospective Medicare ACO completes an application providing the information requested by CMS, including how the ACO plans to deliver high quality care and lower the growth of expenditures for the beneficiaries it serves.


The ACO must agree to accept responsibility for at least 5,000 Medicare Fee-For-Service Beneficiaries and agree to participate for 3 years

The main goals of this partnership are:

Better Care for Patients

Better Health for Communities

Lower costs through improvements for our health care system







Provider participation in ACOs is voluntary.  Are You Thinking About Joining an ACO?If yes, here are some things to know:

Any Medicare enrolled provider or supplier in good standing may participate in an ACO.

ACOs are part of the traditional Medicare Fee-For-Service Program and beneficiaries retain the right to see any provider they choose.

Medicare continues to pay individual providers and suppliers for specific items and services as it currently does under the Fee-For-Service payment systems.







CMS will monitor ACOs to ensure their compliance, including:

Analyzing claims, financial and quality data.

Reviewing the quarterly and annual aggregated reports.

Performing site visits, beneficiary surveys and auditing if necessary.







When an ACO meets the program’s quality performance standards, they may receive a share of the savings if its assigned beneficiary expenditures are below its own specific updated expenditure benchmark.





The regulations would also hold certain ACOs accountable for sharing losses by requiring ACOs to repay Medicare for a portion of losses.







With numerous financial benefits tied directly to the optimization of patient care, I believe all healthcare professionals whether in an ACO or not, should move towards following these same principles.

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