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Health Care Reform History Highlights Challenges for Accountable Care Organizations
New Brief from Mathematica Highlights Factors Likely to Enhance Success

Contact: Cheryl Pedersen, (609) 275-2258

WASHINGTON, D.C. (January 20, 2010)—As the complex work of health care reform continues, a new policy brief from Mathematica Policy Research offers insight into how accountable care organizations (ACOs)—one reform idea—may work. The brief examines ACOs’ role in improving, integrating, and coordinating care delivered by multiple providers. It also places ACOs in the historical context of health care reform in the United States to draw lessons from history on the challenges to be encountered and potential strategies for making ACOs more successful.

ACOs are groupings of diverse health care providers—such as a hospital, primary care physicians, and specialists—that care for a group of people. In contrast to the current fragmented model, ACOs aim to create a cohesive framework, encourage accountability, and create incentives and rewards to providers who focus on the overall scope of patient care. By coordinating and integrating care, ACOs can simplify the process for patients, enhance quality and efficiency, and cut costs.

“ACOs are not the magic bullet for health care reform,” said Marsha Gold, author of the brief and a senior fellow at Mathematica. “But by adopting realistic expectations and applying lessons learned from the past, ACOs could be part of a comprehensive strategy to improve the health care infrastructure.”

Policymakers can use prior reform efforts to shed light on how to design effective ACO initiatives encouraging successful, fundamental change. Along with setting realistic expectations, policymakers should take steps to ensure new initiatives do the following:

  • Actively engage providers
  • Encourage an appropriate provider mix
  • Balance incentives for individual provider participation
  • Match financial incentives to organizational capacity
  • Improve performance measurement and risk adjustment
  • Align ACO incentives with other initiatives, including patient-centered medical homes, chronic disease management, and use of information technology
  • Set challenging but reachable goals
  • Accommodate geographic diversity while continuing to question it

“Accountable Care Organizations: Will They Deliver?” is available at

Mathematica Policy Research, a nonpartisan research firm, provides a full range of research and data collection services, including program evaluation and policy research, survey design and data collection, research assessment and interpretation, and program performance/data management, to improve public well-being. Its clients include federal and state governments, foundations, and private-sector and international organizations. The employee-owned company, with offices in Princeton, N.J., Ann Arbor, Mich., Cambridge, Mass., Chicago, Ill., Oakland, Calif., and Washington, D.C., has conducted some of the most important studies of health care, disability, education, family support, employment, nutrition, and early childhood policies and programs.