Number of ACOs Expected to Double by 2014

Initiatives focused on delivering high-quality and cost-effective care are projected to double the number of accountable care organizations (ACOs) nationwide by the end of 2014, according to a new report.

The estimated 500 ACOs currently in existence throughout the U.S. has already seen its participation nearly quadruple since Spring 2012, notes the report from Premier Inc. (NASDAQ:PINC), a healthcare improvement company that works to unite hospitals and other healthcare providers through data, analytics and collaborative studies.  

Based in Charlotte, North Carolina, Premier Inc. commissioned an online survey in August to determine ACO participation levels, surveying 115 C-suite executives from 101 hospitals of varying sizes.


Survey results showed more than 18% of respondents said their hospitals currently participate in an ACO, up from 4.8% in the Spring of 2012.

This growth is likely to continue, Premier says, as participation is projected to double by the end of 2014 to about 50%. Additionally, 76.5% of executives project their hospitals will be a part of an ACO at some point in the future. 

To better manage their population’s health, many providers are implementing strategies such as investing in technology such as telemedicine (41.3%), while others are establishing partnerships with outside providers like home health agencies (56.9%). 


Smaller, rural and standalone hospitals were the institutions most likely to partner with local public health departments, whereas partnerships with large local employers were popular across all types of providers. 

The size and location of a hospital was also a factor in determining which kind of payer partnerships to enter. 

Non-rural hospitals were more than twice as likely to have partnerships in place with private payers (68.1%) than rural hospitals (26.8%). 

Additionally, these larger hospitals (63.9%) were more likely to have private payer partnerships than smaller institutions (45.2%). 

Establishing a healthy payer partnership is a foundational capability for effective population health management, according to Premier, especially as payers have the ability to reward efforts to improve overall health and reduce utilization of healthcare services through shared savings payments to providers.

“Whether or not they’re in an ACO, it is clear providers are building the infrastructure and core capabilities essential to ACO formation and population health improvement,” Premier writes. “This includes investments in advanced healthcare information technology, and the development of partnerships with other providers, local organizations and payers.” 

Written by Jason Oliva