Safety-net providers are increasingly forming Accountable Care Organizations (ACOs), but limited information exists about how these ACOs function within Medicaid. MACPAC contracted with Abt Global and Bailit Health Purchasing to conduct a series of site visits with safety-net ACOs, to better understand the conditions that drove their formation, their strategies to improve the quality of health care, and the challenges they face.

Among the report’s key findings: providers believe adopting this new payment model is necessary for long-term sustainability but face significant challenges, including limited resources to address the poverty and illness that people with Medicaid face. Hospital-based ACOs also must reconcile their financial need to keep hospital beds full but at the same time reduce readmissions and emergency room visits as a measure of quality of care.

This report was prepared under contract to the Medicaid and CHIP Payment and Access Commission (MACPAC).