Funder: The Commonwealth Fund

Author: Jim Lloyd, Rob Houston, and Tricia McGinnis, Center for Health Care Strategies

October 2015 | Brief


States are increasingly turning to Medicaid accountable care organizations (ACOs) to improve patient outcomes and control costs by shifting accountability for risk and quality to providers. To date, nine states have launched ACO programs for all or part of their Medicaid population, and 10 more are actively pursuing ACOs. This new model, which already serves more than two million Medicaid beneficiaries, is designed to achieve the “Triple Aim:” (1) enhancing the patient experience of care; (2) improving the health of the population; and (3) reducing the per capita cost of health care.

While state ACO models differ widely, all share the following core components: payment model, quality measurement approach, and data strategy. Value-based payment models linked to quality metrics ensure that ACO providers are accountable for high-quality patient care. Effective monitoring of ACO activity requires timely data exchange at both a patient and system level.  As such, ACOs must have the data analytic capacity to identify opportunities to improve performance.

This brief summarizes these core ACO characteristics and profiles how nine states – Colorado, Illinois, Iowa, Maine, Minnesota, New Jersey, Oregon, Utah, and Vermont – have incorporated these elements into their Medicaid ACOs. For each state, it outlines key ACO infrastructure; details unique payment, quality, and data approaches; and spotlights one of the state’s Medicaid ACOs. This set of profiles can help inform Medicaid ACO development in other states.


This brief was developed through CHCS’ Medicaid Accountable Care Organization (ACO) Learning Collaborative, a national initiative made possible by The Commonwealth Fund. The Collaborative is helping states advance new ACO models designed to improve patient outcomes and control costs by shifting accountability for risk and quality to providers.