Over the course of the past decade the concept of an accountable care organization (ACO) has come to define a variety of healthcare provider setups that have primary care as a core focus, payments tied to care quality improvements, and an incentive for lower costs. These models have long been held up as ideal contexts for the flourishing of digital health tools. While not all ACO systems are alike, their core principles generally are. As the Brookings Institution’s Mark McClellan and colleagues explained in a widely cited Health Affairs piece from 2010:
“Accountable care organizations can be implemented through different payment models. These could include opportunities to share in demonstrated savings within a fee-for-service environment, in which providers took on no new financial risk. They could also include limited or substantial capitation arrangements, in which payments were unrelated to the volume of services provided, to the intensity of service use, or to the frequency of face-to-face meetings, and in which providers took on some financial risk for poor-quality results or failure to control costs,” McClellan wrote.
“Thus, accountable care organizations should have considerable flexibility in many aspects of design,” he explained. “At the same time, all variations would be based on these core defining principles: (1) Provider-led organizations with a strong base of primary care that are collectively accountable for quality and total per capita costs across the full continuum of care for a population of patients. (2) Payments linked to quality improvements that also reduce overall costs. (3) Reliable and progressively more sophisticated performance measurement, to support improvement and provide confidence that savings are achieved through improvements in care.”
Some provider groups have been practicing a form of accountable care for decades, but the recent health reform legislation has served as a catalyst for hundreds of other providers to transition to accountable care models. Keep reading>>