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The belief that integrated delivery systems offer better care at lower cost has contributed to growing interest in accountable care organizations. These provider-led delivery systems would accept responsibility for their primary care populations and would have financial incentives for improving care and reducing costs. We investigated this belief by comparing the costs and quality of care provided to Medicare beneficiaries in twenty-two health care markets by physicians who did and did not work within large multispecialty group practices affiliated with the Council of Accountable Physician Practices. In most markets, and after adjustment for patient factors, group physicians affiliated with the council provided higher-quality care at a 3.6 percent lower annual cost ($272 per patient). [ABSTRACT FROM AUTHOR]