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Leavitt Partners Reports: Accountable Care Organizations Have More than Doubled Since 2011

Posted on 21 Feb 2013 by Neilson

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ACOsLeavitt Partners estimates 428 Accountable Care Organizations (ACOs) now exist in 49 states. ACOs have expanded dramatically, more than doubling in number since the start of 2011.

Physician groups are now the largest backers of ACOs, with hospital systems a close second. Delaware is the only state in the country without an ACO, although entities in the state are engaged in ongoing discussions about creating an Accountable Care Organization and ACOs in neighboring states may cover some Diamond State residents.

These and other findings about public and private accountable care organizations are highlighted in a Health Affairs blog post, Continued Growth of Public and Private Accountable Care Organizations, by David Muhlestein, a Leavitt Partners analyst.

Leavitt Partners team members have actively tracked and studied ACOs since 2010. Team members identify ACOs from news articles, government announcements, news releases, conferences, public records and personal interviews. Leavitt Partners conducts detailed interviews to learn about payment arrangements, approaches to coordinating care and future plans. The next area of Leavitt Partners ACO research will be on the core competencies present in successful ACOs.

The growth and dispersion of accountable care organizations continues as the American health care system searches for value, said Leavitt Partners CEO Rich McKeown. While the success or failure of the ACO movement remains an open question, if ACOs meet their quality and cost benchmarks, the ACO model may become the dominant form of health care in the United States over the next decade.

ACOs are designed to lower health care costs, improve quality outcomes and improve the experience of care by moving away from volume-driven, fee-for-service based reimbursement. Instead, ACOs utilize payment models that reward care coordination and quality outcomes.

The Medicare Pioneer ACO and Shared Savings Programs account for more than 250 ACOs and cover up to 4 million Medicare beneficiaries. Private ACOs make up the remainder of ACOs and are actively working to meet cost and quality objectives through full or partial capitation models, bundled payments, retainer agreements, in-kind services and pay-for-performance subsidies.

Provider groups throughout the nation are officially adopting the title of ACO and are implementing some form of contract that encourages population management and cost minimization. While ACO growth will undoubtedly continue for at least the immediate future, it still represents a small minority of care delivered in the United States.

Whether the numerous organizations that are cautiously observing ACOs from the sidelines will ever adopt accountable care models will largely depend on the success of early adopters. In 2013, many ACOs will complete their first year under a risk-based contract. Their early results will influence how payers, providers and policymakers experiment with future iterations of accountable care.

While it is significant that there has been pervasive growth in public and especially private ACOs over the last few years, the perpetuation of these unique collaborations will largely be determined by some very central core competencies, said Leavitt Partners founder and chairman Michael O. Leavitt. We are in the nascent stages of understanding which of these competencies are most important and which ACOs are in possession of them.

To learn more about Leavitt Partners ACO research and analysis visit the LP Center for Accountable Care Intelligence at

About Leavitt Partners

American health care has reached a historic inflection point. We face the reality of a global economy, growing debt and rising health care costs. To remain a compassionate and competitive nation, we must change our current health care system. At Leavitt Partners our passion is to improve health care. We deliver collaborative, high-value intelligence and help organizations navigate the future as they transition to new and better models of care. For more information visit or call (801) 538-5082.


Jeremy Engdahl-Johnson Feb 23 2013 6:47PM Report Abuse
Is it possible that accountable care organizations (ACOs) will create an uptick in medical malpractice claims?
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