What is an accountable care organization?

An accountable care organization (ACO) is defined as a group of healthcare providers who come together to deliver coordinated care to their patients. The primary goal of an ACO is to improve patient outcomes while also reducing healthcare costs. By collaborating, these providers can ensure that patients receive the necessary preventive services, manage chronic conditions more effectively, and avoid unnecessary hospitalizations—all of which contribute to better overall health outcomes.

The formation of ACOs is particularly significant in a value-based care model, where providers are incentivized not just for the quantity of services delivered, but for the quality of care and the health of their patients. This collaborative approach allows for shared accountability among the participating healthcare professionals for the quality and efficiency of care provided to a defined patient population, thereby enhancing patient satisfaction and outcomes.

In contrast, a single hospital focusing solely on patient outcomes does not represent the collaborative essence of an ACO. Similarly, a network of insurance companies or a type of insurance policy does not capture the definition of an ACO, which is fundamentally rooted in the collaboration and accountability among healthcare providers.