The goal of Accountable Care Organizations is to pay health care providers in such a way that it helps and encourages those providers to work cohesively. Encouraging providers to work together, keeps the effects of supply and demand from having a large impact on healthcare; it also aims to reward organizations that provide high quality care.

Many people like to compare ACOs with HMOs, which is a mistake because of the clear differences between HMOs and ACOs. The comparison that is inevitably made can scare people away from ACOs. This is caused by the infamously bad quality that HMOs are notorious for. To help you understand how quality is improved with ACOs, here are 3 of the major differences between the two:

Accountability Matters
When discussing HMOs the accountability factor is almost nonexistent. With ACOs it is the private providers, not the insurance company, that handle the accountability. ACOs are judged and graded on the quality and efficiency of their practice(s) or clinic(s). Without this type of accountability, ACOs would be closer to HMOs, but there still exists clear differences that make the two differ in terms of coverage.

Direct Contact

When trying to make contact with an HMO, it can be hit or miss. If you do make contact, it will be with the HMO intermediary, instead of finding the individual or representative that can help you immediately.

When utilizing an ACO, it is possible for the patent to have direct contact with the provider, giving you full control of your health care, rather than getting a run-around. The ACO will be able to answer all your questions, or allow your provider to take the lead and answer them for you.

Provider Flexibility
When using an HMO, they can be very strict on what types of organizations that can be used. Some regions may prefer different organizations that HMOs aren’t compatible with. ACOs are flexible and allow several different types of coverage for several different types of organizations. A couple of these include IPAs and PHOs. In most cases, HMOs refuse to work with these services. ACOs, on the other hand, work quite well with them.

It makes sense to use physician centered insurance organizations because the vast majority of health care costs come from the decisions of the doctor or health care provider. One field having a problem working with ACOs is the Medicare Program. There have been suggestions that the Medicare program could use a type of “garnishing program”, according to the According to the paper released “What are ACO’s,” (2010), a portion of the cost savings would be reaped by the physician, not just the insurance companies. That profit sharing makes the program interesting not only for patients but also for doctors everywhere.

As you can see, there are several clear differences between the HMO and the ACO. Do not be fooled by the looks; ACOs are the best choice for coverage in many regions of the country.