The ACO model is loosely defined as having integrated teams of providers share responsibility for caring for a select population of patients. (That isn't a new idea -- and based on that definition, California's had dozens of physician-led groups and integrated networks essentially operating as ACOs for years.)
But under the Affordable Care Act, the government is moving to reimburse organizations that succeed at this integrated approach. The Medicare Shared Savings Program is CMS' flagship pilot to reward ACOs for reducing the total cost of care for an assigned population of Medicare beneficiaries.
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Source: California Healthline