ACOs Rising from the Private Sector, Report Finds

A new research report from healthcare business company, Leavitt Partners, found that the number of accountable care organizations (ACOs) across the U.S. have grown 38 percent over the past six months. The report, "Growth and Dispersion of Accountable Care Organizations," found that 221 ACOs have been identified across 45 states and the District of Columbia, and ACO activity in the private sector outnumbers the government sector by a factor of four to one. In November of 2011, there were 160 ACOs in 40 states,

“The consistent growth in the number and variety of organizations adopting accountable care demonstrates the momentum of the ACO movement," Andrew Croshaw, a partner and managing director of the healthcare practice at Leavitt Partners and one of the authors of the study, said in a statement. "Many providers appear to believe the accountable care model is an important component of the future of American health care."

The authors of the report say that central to the accountable care movement is the emerging acknowledgment that the fee-for-service payment approach in this country no longer meets the needs of patients or their providers. The vast majority of ACOs and accountable care models have arisen from the private sector. Medicare accountable care programs are an outgrowth of the private sector movement, not a driving force behind it.

According to the research, the majority of ACOs are found in larger metropolitan regions where multiple systems compete with each other. Also, it found hospital systems sponsor the majority of ACOs, but ACOs backed by physician groups have seen the most recent growth.

The report is Leavitt’s second to one that was released in November of last year. Both aim to document the growth and dispersion of the accountable care movement and provide a baseline for understanding future development.