ACOs at Mid-Launch: Moving Forward but Challenges Ahead

By: Steven M. Lieberman, MPhil, MA, Visiting Scholar, Engelberg Center for Health Care Reform, Brookings Institution

Accountable Care Organizations are generating considerable attention for their potential to improve the value of our health care spending through better coordination of care and new payment incentives that focus on quality and efficiency of care. Yet even as ACOs develop at a fairly rapid clip across the nation, they face substantial challenges. In this essay, Steven Lieberman reviews the ACO landscape in both the public and private sectors and examines the major obstacles confronting these emerging organizations, including limited tools for influencing patient choice, the need for immediate and sustained cost savings, and system-wide concerns about rising costs due to enhanced market power.