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No more low-hanging fruit?

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A JAMA study has found that a federal test program that stems from the Affordable Care Act involving physicians and hospitals slowed healthcare spending in Medicare coverage by hundreds of millions of dollars in 2012 and 2013 but savings were less in the second year.

Reuters reported that the study looked at beneficiaries in 32 Pioneer Accountable Care Organizations (ACOs), in which hospitals and physicians follow 33 quality and care standards for Medicare fee-for-service patients. In return they can receive part of any healthcare savings back from the government.

The savings were 4 percent in the first year but less than 1.5 percent in the second, compared with spending on beneficiaries in traditional Medicare fee-for-service.

The big question is, of course, whether it will much tougher to get hefty new savings over the next few years or whether new systems  and processes (including new technology) will make further efficiencies when those systems are fully integrated. Were the first-year savings simply low-hanging fruit?

New ACO incentive systems are in the pipeline.

One would suspect that some folks at JAMA might not like ACO’s at all because they would tend to reduce the revenues of physicians who have prospered greatly in the fee-for-service system now  under attack by private- and public-sector payers.

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