How ACO Models Align with Outcomes and Care Coordination Strategies

Accountable Care Organizations (ACOs) consist of groups of doctors, hospitals, and other healthcare providers who collaborate and coordinate care for groups of patients. Through performance-based payment models, ACOs share in the savings they attain with the primary goal of improving healthcare quality while reducing costs.

Typically, ACOs share characteristics such as:

• Provider collaboration
• Focusing on quality and performance outcomes
• Emphasizing care coordination
• Taking a patient-centered approach
• Managing population health
• Leveraging technology, interoperability, and data

Types of Accountable Care Organization ownership

ACO ownership tends to be categorized in two ways. The first organizes ACOs into three types:

• Large integrated ACOs
• Small physician-led ACOs
• Hybrid ACOs (A mix of large integrated and small physician-led ACOs)

The second organizes ACOs into five types:

• Physician-led ACOs
• Hospital-led ACOs
• For-profit ACOs
• Nonprofit ACOs
• Federally Qualified Health Center (FQHC)-led ACOs

This model focuses less on size and more on who is leading the ACO or if it is for-profit, nonprofit, or rural.

Common payment models for ACOs

Most ACOs participate in government programs offered by the Centers for Medicare and Medicaid Services (CMS). While several ACO payment models have been tested, as of 2025, four ACO payment models are active for Medicare beneficiaries, including:

Medicare Shared Savings Program (MSSP): Established in 2012, MSSP is a permanent program that encourages ACOs to reduce healthcare costs while maintaining or improving quality. In January 2024, MSSP included 480 ACOs serving 10.8 million beneficiaries.

As the largest ACO payment program, MSSP features two tracks:

• Basic: ACOs can begin with shared savings only and transition to higher levels of risk through a glide path.
• Enhanced: ACOs take on more risk in this two-sided model that offers higher potential rewards. Starting in 2024, participation in the enhanced track became optional.

ACO Realizing Equity, Access, and Community Health (REACH) model: Launched in January 2023, the ACO REACH model focuses on promoting health equity and access. In 2025, 103 ACOs continue to participate in this model. 

The ACO REACH model requires participating providers or their designated representatives to hold at least 75% control of each ACO's governing body.

ACO REACH offers two risk-sharing options:

• Global Risk: ACOs are responsible for 100% of performance year expenditures for services delivered to beneficiaries with a benchmark discount applied to ensure savings for CMS.
• Professional Risk: ACOs share 50% of any savings or losses without a benchmark discount.

ACO Primary Care Flex (PC Flex) model: As the newest MSSP option, PC Flex launched in 2025 as a five-year voluntary model. It aims to enhance primary care delivery by providing prospective payments and increased funding to low-revenue ACOs. These are typically physician-led and may include small or rural hospitals.

Kidney Care Choices (KCC) model: This model includes 78 kidney contracting entities and 15 Kidney Care First Practices continuing participation in 2025. It focuses on improving care for patients with chronic kidney disease.

ACO ownership types and preferred payment models

The table below summarizes which payment type may be preferred by different types of ACOs and why their structure may align better with those models.

How ownership impacts performance and outcomes

Research suggests that ACOs have maintained or improved quality while generating modest savings. But how has their ownership type impacted performance?

Analysis of a national survey of ACOs compared MSSP performance of three ACO types mentioned earlier (physician-led, integrated, and hybrid) across three domains (quality, spending, and potential for savings).

The research found that the types of ACO ownership had less of an impact on performance. Researchers uncovered greater heterogeneity within ACO types than between ACO types. In fact, ACO type accounts for only up to a five percent variance in performance.

The factors that were most influential on performance included:

• Organizational culture
• Leadership style
• Use of team-based care
• Organizational integration

These factors had more impact on performance differences than ownership type.

Other studies highlighted additional characteristics that improved outcomes, including:

• Having a primary care-centricity: ACOs with a higher proportion of primary care physicians performed better, generating 2.4 times the savings of low primary care-centric ACOs.
• Savings increase with experience: As ACOs mature and gain experience, their savings tend to increase.
• Physician leadership: ACOs led by physicians often demonstrate better financial performance.
• Focus on prevention and chronic care: Leveraging Annual Wellness Visits, Chronic Care Management, and care coordination were consistent markers of successful ACOs.
• MSSP participation: Since 2021, nearly all ACOs have met the quality threshold for shared savings eligibility. However, MSSP ACOs tend to outperform in quality metrics.
• Historical service use: Research has also shown that historical use of services within the geographic region where beneficiaries live was highly correlated to higher savings relative.

Analysis based on ACO value scores uncovered additional factors that were associated with high-value ACOs, including:

• Coding practices: Enhancing coding practices helps capture the clinical complexity of patients, which may be tied to changes in MSSP financial benchmarking.
• Transitions of care: ACO leaders invested in programs to improve patient flow across care settings, facilitating care transitions.
• Clinician engagement: ACOs engaged clinicians through relationship-based and metrics-based strategies, using dashboards to display performance on quality and cost measures.
• Savings distribution: Most ACO leaders distributed at least 50% of savings to participating practices, often based on the number of attributed patients. Some linked payments to quality performance and clinician engagement.

How ACO ownership aligns with care coordination and care management strategies

ACOs that implement care coordination and care management programs have been shown to perform better.

Additionally, the type of ACO ownership can influence the structure, investment, and types of care management and care coordination strategies implemented. Different kinds of ACOs have varying levels of financial resources, infrastructure, and strategic priorities, leading to various approaches to managing patient care.

In general, physician-led ACOs prioritize personalized primary care-based coordination but may lack funding for large-scale programs. Hospital-led ACOs leverage their existing infrastructure for hospital-to-home transitions but may be less aggressive in reducing inpatient utilization.

For-profit ACOs focus on technology-driven, data-based care coordination, maximizing efficiency but sometimes at the expense of comprehensive care. Nonprofit and FQHC-led ACOs emphasize community-based and preventive care, integrating social determinants of health but facing financial limitations.

The table below suggests potential strengths, challenges, and care management focuses for each type of ACO.

Each type of ACO ownership demonstrates particular strengths and focus within a beneficiary population. 

Research shows that various aspects within each ACO have a more significant impact on care quality and performance outcomes. This includes team-based care, care coordination, chronic disease management, and improved care transitions.

ThoroughCare enables care management for ACOs

ThoroughCare helps Accountable Care Organizations coordinate care efficiently for improved outcomes and greater efficiency. We offer a comprehensive software and analytics platform, clinical advisory expertise, and tailored assistance to achieve your organization’s goals.

Our platform supports ACOs with:

• Performance metrics and cost reporting
• ACO oversight across members, including group functionality
• Medicare care management compliance and billing
• Timely interventions
• Personalized care plans
• Data integration and interoperability

Key questions answered

What are the types of ACO ownership?

Depending on the source, there are two main ways that ACOs are categorized by ownership type.

The first organizes ACOs into three types:

• Large integrated ACOs
• Small physician-led ACOs
• Hybrid ACOs (A mix of large integrated and small physician-led ACOs)

The second organizes ACOs into five types:

• Physician-led ACOs
• Hospital-led ACOs
• For-profit ACOs
• Nonprofit ACOs
• Federally Qualified Health Center (FQHC)-led ACOs

How does ACO ownership impact care quality and performance outcomes?

Research has shown that quality and performance were quite similar across ACO ownership types. There are factors within the ACO type that associate with higher performance metrics, including:

• Organizational culture
• Leadership style
• Use of team-based care
• Organizational integration
• Primary care-centricity
• ACO maturity
• Physician leadership
• Focus on annual wellness visits, transitional care, and chronic care management
• MSSP participation
• Historical service use by geography