Accountable Care Organization (ACO)

ACOs are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high-quality care to their Medicare patients.

The goal of coordinated care is to ensure that patients get the right care at the right time, while avoiding unnecessary duplication of services and preventing medical errors.

When an ACO succeeds both in delivering high-quality care and spending health care dollars more wisely, the ACO will share in the savings it achieves for the Medicare program.

Participation in a Shared Savings Program Accountable Care Organization (ACO) creates incentives for health care providers to work together to treat an individual patient across care settings, including doctor’s offices, hospitals, and long-term care facilities.

Eligible ACO providers and suppliers that may participate in the Shared Savings Program include:

  • 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
  • Critical Access Hospitals (CAHs) that bill under Method II
  • Federally Qualified Health Centers (FQHCs)
  • Rural Health Clinics (RHCs)
  • Teaching hospitals that have elected to receive payment on a reasonable cost basis for the direct medical and surgical services of their physicians

Provider Participation

To participate in the Shared Savings Program, Medicare-enrolled providers and suppliers must form or join an ACO, and the ACO must apply and be accepted to the Shared Savings Program. Providers and suppliers may contact other ACO participants in the region, state, or national professional associations to investigate opportunities to join an ACO. ACOs must have at least 5,000 Medicare fee-for-service (FFS) beneficiaries assigned to their ACO in each benchmark year to be eligible for participation in the Shared Savings Program.