Searching for Strategies to Improve the Value of Healthcare in Accountable Care Organizations

Accountable Care Organizations (ACOs) were established by the Affordable Care Act as a way to improve the value of healthcare—defined as the ratio of healthcare quality to cost—in the Medicare population. ACOs are incentivized to achieve high-value care by keeping a portion of their cost savings below a set benchmark. This model has created an environment of experimentation in which organizations are choosing different inputs to achieve the same goal of high-value care. While the number of healthcare providers opting into ACOs is rapidly increasing, the novelty of this policy has resulted in a paucity of systematic studies examining what factors contribute to high-performance ACOs. To address this gap, the Capstone team analyzed the most up-to-date, partial panel data on ACO characteristics from the Center for Medicare and Medicaid Services public use files. The team identified the specific strategies associated with holistic measures of high-value care that include lower costs as well as better health outcomes.