Which statement defines an Accountable Care Organization (ACO) in the Medicare context?

• A. An ACO is a model that only covers outpatient services.
• B. An ACO is a fee-for-service payment model with no risk.
• C. An ACO is a program that imposes penalties without any shared savings.
• D. An ACO is a network of providers responsible for the total care of a defined patient population, aimed at improving quality and reducing costs with shared savings if benchmarks are met.

Answer: (D)

An ACO in Medicare is a network of providers who are collectively responsible for the total care and costs of a defined patient population, with the aim of improving quality and reducing spending. This setup promotes care coordination across primary care, specialists, hospitals, and post-acute services, using data and care-management strategies to prevent gaps and unnecessary services. If the ACO meets quality benchmarks and lowers costs relative to a benchmark, it shares a portion of the savings with Medicare and its beneficiaries. Some models also involve downside risk where losses are shared if costs exceed targets. This combination of accountability for both cost and quality and the potential for shared savings is what defines an ACO in the Medicare context. The other descriptions miss key elements like cross-continuum accountability or the incentive of shared savings.