Do ACOs still exist?

The five largest hospital systems in the United States by number of hospitals and overall scale are HCA Healthcare, Veterans Health Administration, CommonSpirit Health, Ascension, and Trinity Health.

The Top 5 Systems

• HCA Healthcare: Headquartered in Nashville, Tennessee, it is the largest for-profit system in the U.S. operating over 220 hospitals.
• Veterans Health Administration: Run by the federal government, this massive system includes over 170 medical centers nationwide.
• CommonSpirit Health: Based in Chicago, Illinois, this large non-profit Catholic system operates around 140 to 150 hospitals across multiple states.
• Ascension: Headquartered in St. Louis, Missouri, this non-profit Catholic network operates around 90 to 140 facilities after recent portfolio streamlining.
• Trinity Health: Based in Livonia, Michigan, this major Catholic health care delivery network operates over 100 hospitals across more than 20 states.

Accountable Care Organizations (ACOs) solve problems related to fragmented, high-cost, and uncoordinated healthcare delivery.

Fragmented Care and Lack of Coordination

• Disconnected providers: Doctors often work in isolation, leading to poor communication between primary care physicians and specialists.
• Duplicate tests: Patients repeat expensive lab work or imaging because different facilities cannot share records easily.
• Solution: ACOs build networks that connect doctors, hospitals, and providers to share patient information and coordinate treatment plans.

High Costs and Wasteful Spending

• Fee-for-service flaws: Traditional payment models reward doctors based on the quantity of services provided rather than results, driving up costs.
• Avoidable spending: Unnecessary hospital visits and emergency room trips strain the healthcare system.
• Solution: ACOs use value-based care models, rewarding providers financially when they lower overall spending while meeting high-quality care standards.

Poor Management of Chronic Diseases

• Reactive treatment: The system often treats sickness after it worsens rather than preventing it.
• Readmissions: Patients frequently return to the hospital shortly after discharge due to a lack of follow-up care.
• Solution: ACOs emphasize preventive care, chronic disease management, and close follow-up support to keep patients healthy at home.

The Long-term Enhanced ACO Design (LEAD) Model is replacing the ACO REACH program when it concludes on December 31, 2026.

The Centers for Medicare & Medicaid Services (CMS) designed the LEAD model to build on past value-based care efforts while fixing financial and administrative hurdles that kept smaller groups out of ACO REACH.

Key Features of the LEAD Model

• Longer Timeline: Runs for 10 years from January 1, 2027, through December 31, 2036, making it the longest model CMS has tested.
• Stable Benchmarks: Locks in spending baselines for the entire decade with no mid-model resetting or rebasing.
• Better Inclusion: Focuses on bringing in smaller, rural, and independent practices that struggled with the upfront costs of ACO REACH.
• High-Needs Integration: Removes the separate high-needs track and builds complex patient support into every standard ACO.
• Specialist Engagement: Expands payment options and risk-sharing tools to involve specialists more directly.

No broad groups of people are losing traditional Medicare in 2026, but some Medicare Advantage enrollees face forced plan terminations, and roughly 100,000 lawfully present immigrants are projected to lose Medicare later due to recent federal legislation.

Medicare Advantage Changes

• Forced Disenrollment: According to Johns Hopkins Bloomberg School of Public Health, about 1 in 10 Medicare Advantage enrollees face forced plan disenrollment in 2026 as insurers scale back offerings.
• Network Drops: Major health systems nationwide have dropped specific Medicare Advantage plans due to disputes over prior authorization and reimbursements.

Immigrant Eligibility and Future Cuts

• Medicaid vs. Medicare: Recent changes from the federal spending law (such as the One Big Beautiful Bill Act) primarily target Medicaid eligibility for certain lawfully present immigrants starting October 1, 2026.
• Medicare Impact: While Medicaid changes took effect in late 2026, the Congressional Budget Office estimates that roughly 100,000 lawfully present immigrants could eventually lose Medicare coverage, with formal terminations anticipated around February 1, 2027.

A Medicare Accountable Care Organization (ACO) is a group of doctors, hospitals, and health care providers who work together to give coordinated, high-quality care to Original Medicare patients.

How ACOs Work

• Coordinated Care: Providers share health information and work together to manage your overall health, avoiding repeated tests and paperwork.
• No Change in Costs or Rights: Your Medicare coverage, out-of-pocket costs, and doctor choices do not change if your provider joins an ACO.
• Shared Savings: When an ACO improves care quality and lowers spending growth below Medicare benchmarks, participating providers can share in the financial savings.
• Not Insurance: An ACO is a care coordination model within Original Medicare, not a Medicare Advantage plan or an HMO.

Main Medicare ACO Programs

• Medicare Shared Savings Program: The permanent, voluntary program encouraging provider groups to deliver efficient, high-value care.
• ACO REACH: A model focused on health equity and underserved communities, scheduled to run through December 31, 2026.
• LEAD Design: The Long-term Enhanced ACO Design scheduled to launch on January 1, 2027, introducing broader technology integration and participation incentives.

You can learn more details about coordinated care and find official guidance on the Medicare Accountable Care Organizations Page.