As healthcare consolidation continues across the industry, think large hospital systems acquiring independent practices or insurers merging with provider networks, questions remain about how ownership structure influences performance under value-based care. While all Accountable Care Organizations (ACOs) share the goal of improving quality and reducing healthcare costs, the organizations responsible for governing and managing those ACOs can differ significantly. Emerging research suggests that these differences in ownership and governance may influence financial incentives, operational priorities, and long-term performance.
Understanding ACO Ownership Models
Under value-based care, ACOs are responsible for coordinating care, improving outcomes, and managing healthcare spending for a defined patient population. Some ACOs are physician-owned, meaning physicians maintain significant ownership interests and play a central role in governance and strategic decision-making. Others are structured around hospital systems, health systems, or management organizations, each bringing their own operational priorities and governance approaches to the table. These structural differences can influence how organizations allocate resources, engage clinicians, and pursue performance goals under value-based care.
Governance and Organizational Control
According to the first national survey of 173 ACOs conducted between 2012 and 2013, physicians played a leading role in organizational governance, with 51% of ACOs physician-led and another 33% jointly led by physicians and hospitals. The findings suggest that physician involvement in governance has been a defining characteristic of many ACOs since the early years of value-based care.
Ownership Structure and Cost Performance
Ownership may matter because governance influences incentives. Physician-owned ACOs are often structured around reducing avoidable utilization, improving preventive care, and managing chronic conditions in outpatient settings. Because participating physicians are directly involved in both clinical and operational decision-making, there may be stronger alignment between patient outcomes and financial performance.
Research examining healthcare spending patterns provides additional insight. A California study analyzing expenditures across 4.5 million patients between 2009 and 2012 found a clear example of this divide. Hospital-owned and multihospital physician organizations averaged between $4,300 and $4,800 in annual spending per patient, compared to approximately $3,000 per patient among physician-owned organizations. Even after accounting for patient and organizational differences, physician-owned organizations continued to operate at lower costs than hospital-owned groups (JAMA, 2014).
While these findings do not prove that ownership alone determines performance, they raise important questions about how organizational control influences healthcare spending. Physician owners may have greater flexibility to implement care management strategies focused on prevention, care coordination, and reducing unnecessary utilization. Non-physician-owned organizations may benefit from larger infrastructures, broader care networks, and greater access to capital, but they may also face different financial pressures and operational priorities.
That does not mean one ownership model is universally superior. Non-physician-owned ACOs often possess sophisticated analytics capabilities, dedicated care management resources, and the financial capacity to manage downside risk. At the same time, physician-owned ACOs may benefit from closer alignment between clinical decision-making and organizational goals.
As value-based care continues to expand, ownership and governance structures will remain important considerations for healthcare organizations evaluating participation in ACO models. Understanding how incentives, decision-making authority, and operational priorities differ across ownership structures may help organizations better position themselves for long-term success.
Organizations like Advanced Management USA LLC support physician-centered ACOs by providing care coordination, analytics, and administrative infrastructure that allow independent physicians to participate in value-based care while maintaining greater control over clinical and operational decision-making. Beyond administrative support, companies like Advanced Management USA LLC also help operate physician-led ACOs actively working to sustain physician independence for their participants and ensuring that decision-making authority stays with the physicians, not the health systems.
References:
JAMA. (2014). Total Expenditures per Patient in Hospital-Owned and Physician-Owned Physician Organizations in California. Link
The Commonwealth Fund. (2014). First National Survey of ACOs Finds That Physicians Are Playing Strong Leadership and Ownership Roles. Link
Advanced Management USA, LLC. (2025). Why PCPs Should Make the Move to Value Based Care — and Why It’s More Critical Than Ever Link
Advanced Management USA, LLC. (2025). Why Primary Care Providers Should Join an ACO Now: The Value-Based Care Future Is Here Link
