Accountable Care Organizations & Quality Initiative


Healthcare systems and hospitals should evaluate their capabilities and resources in an attempt to identify existing gaps and key areas that require continuous improvement. Such an initiative has the potential to minimize issues in care delivery, including readmissions, increased costs, and sentinel events. Fortunately, numerous ideas and developments are becoming common across this industry in an attempt to improve patients’ health experiences. This paper gives a detailed analysis of Accountable Care Organizations (ACOs) as one of the innovations put in place to address the medical challenges many citizens face.

Accountable Care Organizations (ACOs)

Key Features

Accountable care organizations (ACOs) are associations of insurers, healthcare providers, and hospitals that assume medical and financial responsibilities for different Medicare patients. Due to the coordinated efforts associated with them, patients do not have to incur additional expenses since resources are combined (Colla et al., 2016, p. 1168). Physicians and insurers will also monitor individuals’ information through the use of electronic health records (EHRs). Such medical professionals collaborate, thereby saving money by preventing duplication of medical procedures and laboratory tests.

Although ACOs do no abolish fees for service, they create new opportunities for ensuring that medical costs are always low. This means that such physicians will receive additional rewards for empowering their respective patients and minimizing the rate of hospitalization. The presence or availability of primary care professionals is a critical feature of every ACO. This happens to be the case since such physicians are the key players in medical care delivery. Every ACO program requires an electronic health record system that stakeholders can utilize to track patients and their respective needs. The system should have a payment structure that is aligned with the efficiency and quality of care (Balzac, 2014, p. 38). With such features in place, physicians, insurers, hospitals, and patients can evaluate the quality of medical support and make appropriate inferences from the recorded outcomes.


The functionality and effectiveness of every ACO depend on the availability of finances and other relevant resources. The first key sponsor of these quality improvement initiatives is the Medicare Shared Savings Program (MSSP). This agency provides adequate financial incentives to ensure that ACOs do not replicate critical medical practices or procedures. The second source of critical resources is every hospital participating in the program in an attempt to deliver positive results (Brockett, Golden, & Yang, 2018, p. 459). Such stakeholders provide the required capital for supporting the infrastructure that can result in positive quality reporting. They also share data between outpatient and inpatient settings.

Currently, Medicare remains the primary payer for all the ACOs established in the United States. However, there are other sponsors that provide adequate financial resources to support their effectiveness and ensure that more patients receive high-quality and cheaper medical care (Colla et al., 2016, p. 1172). Some of them include employers and private insurance companies that meet the needs of American citizens. Such stakeholders are essential since they make it possible for ACOs to lower their operational expenses, streamline care delivery procedures, and maximize quality. They can collaborate and identify evidence-based initiatives for improving patients’ experiences and making it possible for them to achieve their potential.

Areas to Improve

Stakeholders and hospitals can establish an ACO depending on the anticipated objectives and expectations. Although some differences exist from one ACO to another, the outstanding fact is that they all tend to have a common purpose. Balzac (2014) indicates that the original aim was to “coordinate care across the spectrum of providers involved while ensuring that patient care is consistently high-quality throughout the process” (p. 38). Some of the key players or stakeholders include hospitals, insurance companies, and physicians. The formation of these quality improvement organizations was, therefore, an initiative aimed at transforming the health experiences of more patients.

The first framework encompassing the establishment of ACOs was to improve the health outcome of every Medicare enrollee in need of sustainable medical services. This would be realized through the provision of quality care that could result in increased patient satisfaction. The second one was for the program to address the major causes or triggers of poor health by implementing initiatives and campaigns that can address a wide range of issues, such as poor nutrition and risky behaviors (Balzac, 2014, p. 39). More people in different communities would record positive health results following the introduction of adequate preventative measures. The third aspect was that such ACOs would minimize medical costs and expenses. This would be achieved by altering existing incentives and reducing most of the procedures needed to meet the health demands of different patients. Hospitals and physicians who manage to achieve these aims can get appropriate payments and rewards, thereby being able to transform the experiences of different American citizens.


The establishment of ACOs is an innovative idea that has delivered positive results in the United States. Firstly, most of the stakeholders have managed to coordinate their care delivery processes by sharing resources and minimizing the duplication of similar medical procedures. This achievement has been possible due to the emergence of various health information technologies (HITs), such as telemedicine and EHRs. Due to the streamlined nature of communication, insurers and providers can exchange ideas and support the reduction of medical costs (Joshi, Ransom, Nash, & Ransom, 2014, p. 545). Throughout the care delivery process, alerts are shared whenever there is a form of duplication.

The introduction of ACOs is an innovative idea that is currently making it easier for patients to minimize the volume of paperwork. This is the case since all the stakeholders in a given ACO are able to access EHRs instantly. When a given patient is in need of additional services, he or she will be referred to a specialist within the ACO, thereby minimizing medical costs. This initiative explains why most of the Medicare beneficiaries record positive health results and increased patient satisfaction (Brockett et al., 2018, p. 461). Similarly, providers and insurers receive better rewards for upholding the conditions or expectations of the program. The ultimate result is that many people have recorded positive health outcomes due to the implemented safety measures, reduced sentinel events, and coordinated care efforts.


The above discussion has defined and described ACOs as critical quality improvement initiatives that have been introduced in the healthcare sector to transform the outcomes of different Medicare beneficiaries. The involvement of several stakeholders and the desire to fulfill outlined requirements is something that makes this innovation relevant and capable of improving patients’ experiences. Since the recorded results are admirable, there is a need for more hospitals and organizations to form similar ACOs in order to improve patient satisfaction and the quality of services available in different medical facilities.


Balzac, F. (2014). Accountable care organizations aim to provide better health care. Neurology Reviews, 22(9), 38-39.

Brockett, P. L., Golden, L. L., & Yang, C. C. (2018). Potential “savings” of Medicare: The analysis of Medicare advantage and accountable care organizations. North American Actuarial Journal, 22(3), 458-472. Web.

Colla, C. H., Lewis, V. A., Kao, L., O’Malley, A. J., Chang, C., & Fisher, E. S. (2016). Association between Medicare accountable care organization implementation and spending among clinically vulnerable beneficiaries. JAMA Internal Medicine, 176(8), 1167-1175. Web.

Joshi, M., Ransom, E. R., Nash, D. B., & Ransom, S. B. (2014). The healthcare quality book: Vision, strategy, and tools (3rd ed.). Chicago, IL: Health Administration Press.