Accountable Care Organizations, Explained

by Jenny Gold

As the House begins debate today on an effort to repeal the health care law, we took a closer look at one of the provisions of the law that health care providers are talking about the most — accountable care organizations.

ACOs take up only seven pages of the massive new health law but the idea has providers buzzing. ACOs are a new model for delivering health services that offers doctors and hospitals financial incentives to provide good quality care to Medicare beneficiaries while keeping down costs. A cottage industry of consultants has sprung up to help even ordinary hospitals become the first ACOs on the block.

Yet the concept is still short on details. ACOs have been compared to the  unicorn: Everyone seems to know what it looks like, but nobody’s actually seen one. Exactly how ACOs would work in practice remains to be seen, though that hasn’t stopped the health care industry from embarking on a frenzied quest to create them as quickly as possible. The Centers for Medicare & Medicaid Services is expected to release detailed rules on ACOs within a few weeks.

Here is a brief guide to what we know about ACOs so far.

What is an accountable care organization?

An ACO is a network of doctors and hospitals that shares responsibility for providing care to patients. Under the new law, ACOs would agree to manage all of the health care needs of a minimum of 5,000 Medicare beneficiaries for at least three years.
Think of it as buying a television, says (read complete article, here).

This story was produced through collaboration between NPR and Kaiser Health News (KHN), an editorially independent news service and a program of the Kaiser Family Foundation, a nonpartisan health care policy organization that isn’t affiliated with Kaiser Permanente.


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