A program aimed at overhauling how you pay for medical care saved the federal government nearly $400 million over the last two years.
Pioneer Accountable Care Organizations (ACOs), which coordinate care between doctors and hospitals, saved Medicare $384 million in 2012 and 2013, according to the Centers for Medicare and Medicaid Services (CMS). The agency announced Monday that independent actuaries have certified that ACOs can cut healthcare costs, paving the way for the organizations to be expanded.
An ACO is a group of doctors and hospitals who get together to coordinate care and save money by not doing repetitive or unnecessary procedures.
Each member of the ACO gets a cut of any savings generated. However, if the ACO experiences losses, doctors and hospitals have to instead pay CMS their share of the losses.
The Pioneer model was the first to experiment with ACOs, whose creation was mandated by the Affordable Care Act. The project started with 32 organizations but 13 dropped out.
Of the 19 organizations that remained, all but two experienced savings. Acting CMS Deputy Administrator Patrick Conway declined to elaborate on how much the two ACOs had to pay during a Monday call with reporters.
Conway says CMS will expand the number of beneficiaries in ACOs from 600,000. However, he also couldn’t say more on an estimate of how many additional beneficiaries will be impacted.
There are more than 40 million beneficiaries in Medicare.
