When Congress passed the Affordable Health Care Act, Accountable Care Organizations (“ACOs”) were touted as a cutting-edge solution to rising U.S. health care costs. Now, ACOs are being criticized, with even some of those touted as models for the program refusing to participate under the proposed rules. This Health Law Checkup will discuss several potential disincentives to ACO participation contained in the proposed regulations for ACOs, which were promulgated by the Department of Health and Human Services earlier this year.

What Are ACOs?

ACOs are designed to be integrated groups of health care providers (hospitals, physicians and others involved in patient care) that work together to coordinate care for Medicare patients. According to the Centers for Medicare & Medicaid Services (CMS), ACOs are expected to “help improve the care Medicare beneficiaries receive, while also helping lower costs.” ACOs are supposed to address the fragmented care that many patients, especially seniors with multiple illnesses, experience. Fragmented care can often lead to medical mistakes and increased costs.