Accountable Care Organization (ACO)

The term accountable care organization was first used by Elliott Fisher in 2006 during a discussion of the Medicare Payment Advisory Commission. In 2009, the term was included in the federal Patient Protection and Affordable Care Act. It resembles the definition of Health Maintenance Organizations (HMO) that emerged in the 1970s. Like an HMO, an ACO is “an entity that will be ‘held accountable’ for providing comprehensive health services to a population. The model builds on the Medicare Physician Group Practice Demonstration and the Medicare Health Care Quality Demonstration, established by the 2003 Medicare Prescription Drug, Improvement, and Modernization Act.

According to the Centers for Medicare and Medicaid Services, an ACO is “an organization of health care practitioners that agrees to be accountable for the quality, cost, and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program who are assigned to it. An accountable care organization (ACO) is a healthcare organization that ties provider reimbursements to quality metrics and reductions in the cost of care. This service is designed to provide a quick reference and an opportunity to enhance your knowledge acumen.