The Affordable Care Act, a part of the health care reform legislation that became law in early 2010, is designed to improve the health care delivery system for Medicare patients through incentives to enhance quality, improve beneficiary outcomes, and increase the value of care.

One of the key delivery reforms is the encouragement of the creation of accountable care organizations. As originally set up, ACOs are designed to facilitate coordination and cooperation among providers to improve the quality of care for Medicare beneficiaries and reduce unnecessary costs. An ACO is an organization of health care providers that agrees to be accountable for the quality, cost, and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program.

What forms of organizations can become ACOs?