Medicare Networks: A Proposal for the Future of ACOs

Medicare Networks would be an enhanced, enrollment-based model for the future of accountable care organizations (ACOs). Similar to today’s ACOs, Medicare Networks would be formed and led by health care providers who would be held responsible for the cost, quality, and coordination of care delivered to a defined group of beneficiaries. Unlike today’s ACOs, beneficiaries would have the opportunity to select their Medicare Network and would have incentives to access care from Medicare Network providers. Networks could be paid entirely through the Medicare fee schedules or accept partial capitation, in which networks would receive a combination of a fixed per-beneficiary payment plus some payment through the fee schedules. Future fee-schedule updates would be reserved for providers who form or join a Medicare Network, which would be measured against regional benchmarks.