Obama Administration Unveils New Idea for Getting Better Quality Care for Lower Cost

On Thursday, March 31st, the Obama administration released new rules governing Accountable Care Organizations. ACO’s (as they’re often called) are organizations of doctors and hospitals that  work together to improve health outcomes and lower cost by coordinating care for their patients and reducing medical errors. During the announcement Health and Human Services Secretary Kathleen Sebelius said “We need to bring the days of fragmented care to an end.”

The Affordable Care Act passed in March of last year directed Health and Human Services along with other government agencies to setup up the rules by which these new organization can function under Medicare. The new regulations setup incentives for doctors and hospital to form these organizations by allowing them to share in any cost savings they’re able to achieve. ACOs that manage to save money will split the savings with Medicare, while those that don’t will be expected to pay Medicare for cost overruns. Medicare’s independent office of actuary estimates that this program could save $960 million over three years.

In order to ensure that these incentives for cost savings don’t lead providers to skimp on care, the new regulations also include 65 measures of quality that all ACOs must meet. These measures fall into five broad categories, including patient experience of care, care coordination, patient safety, preventive health, and care delivery for at-risk and frail elderly populations. Patients that enroll in these groups will also have the freedom to see any other doctor in the Medicare network, ensuring that providers won’t deny care for fear of losing patients.


For more information on Accountable Care Organizations check out NPRs informative fact sheet here. The New Republic also has a great explanation here.


-- The Boston Globe / Kaiser Health News / The Hill / NPR / The New Republic