February 27, 2015

New Report: Medicare Accountable Care Organizations

OLR Report 2015-R-0033 discusses Medicare Accountable Care Organizations (ACOs).

Medicare ACOs are voluntary networks of doctors, hospitals, and other health care providers that coordinate care for Medicare patients (excluding those enrolled in Medicare Advantage (Part C) private plans). The Affordable Care Act (P.L. 111-148, § 3022) authorized the use of ACOs as a way to improve patient care and reduce health care costs in the Medicare program. Providers may participate in a Medicare ACO and commercial payer ACO at the same time.

ACOs assume medical and financial responsibility for their Medicare patients’ care. While they still use Medicare’s traditional fee-for-service payment system, ACOs are eligible for additional payments or bonuses when providers coordinate care, reduce Medicare spending, and meet specified quality of care benchmarks.

Medicare currently offers three ACO programs: the Medicare Shared Savings Program, the Advanced Payment ACO Model, and the Pioneer ACO Model. Click here to read more about these programs in the full report.