The term Accountable Care Organization (ACO) was first used by Elliott Fisher - Director of the Center for Health Policy Research at Dartmouth Medical School - in 2006 during a discussion at a public meeting of the Medicare Payment Advisory Commission. The term quickly became widespread, reaching its pinnacle in 2009, when it was included in the federal Patient Protection and Affordable Care Act. Although the term ACO was not coined until 2006, it bears resemblance to the definition of the Health Maintenance Organization (HMO), which rose to prominence in the 1970s. Like the HMO, the ACO is “an entity that will be 'held accountable' for providing comprehensive health services to a population.” The ACO-model builds on the Medicare Physician Group Practice Demonstration and the Medicare Health Care Quality Demonstration, established by the 2003 Medicare Prescription Drug, Improvement, and Modernization Act. Kaiser Permanente and HealthCare Partners Medical Group are two notable examples of successful ACO prototypes.
Mission
The mission of the ACO is to support doctors as they care for their patients, while also helping a patient's team of healthcare providers work together more closely. Doctors choose to participate in an ACO because they're committed to providing their patients with a better care experience.
An “ACO Participant” means those individuals and/or entities which: (a) demonstrate a “meaningful commitment” to the mission of the ACO (as set forth in 42 C.F.R. § 425.108(d)) by agreeing to abide by, and be bound by, the terms of a provider agreement in the form acceptable to the Governing Board (an “ACO Provider Agreement”); and (b) satisfy the criteria as an Eligible Party or Eligible Parties as defined herein.
Affiliation
The affiliated ACOs are groups of doctors, hospitals, and other health care providers, who come together voluntarily to provide coordinated, high quality care to their Medicare patients. Coordinated care helps ensure that patients, especially the chronically ill, get the right care at the right time, with the goal of avoiding unnecessary duplication of services and preventing medical errors.
Organization
An ACO participant is defined at §425.20 as an individual or group of ACO providers/suppliers that is identified by a Medicare-enrolled tax ID number (TIN), that alone or together with one or more other ACO participants comprises the ACO, and that is included on the list of ACO participants required to be submitted as part of the application and updated at the start of each performance year and at other times as specified by CMS. An ACO participant bills Medicare for services through its Medicare-enrolled TIN, or CMS Certification Number (CCN). ACO participant billing TINs (or CCNs) are the basis for establishing eligibility, assignment of beneficiaries, computation of the benchmark, and quality assessment.