What are Accountable Care Organizations (ACOs)?

• A. Groups of providers who agree to take on responsibility for costs and quality of a large group of patients (5,000 up to 250,000)
• B. A hospital-based organization focusing on inpatient care
• C. A model with no quality metrics
• D. A fee-for-service only model

Answer: (A)

ACOs are groups of healthcare providers who come together to coordinate care for a defined population and take responsibility for both the costs and the quality of that care. They typically attribute a specific number of patients—often in the thousands to tens of thousands (roughly 5,000 up to 250,000)—and are rewarded for reducing overall spending while meeting agreed-upon quality targets. The aim is to align incentives so care is more integrated, focusing on prevention, care coordination, and smooth transitions across settings, rather than paying for each service in isolation. This distinguishes them from models that are inpatient-focused, lack quality metrics, or operate strictly under fee-for-service without shared savings or accountability.