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How to Control Healthcare Costs: Make Hospitals Share Financial Risk

Under the Affordable Care Act, Medicare has been empowered to try alternative reimbursement methods to counteract the tendency of traditional fee for service to raise costs. One of those alternatives, as I explained a couple of weeks ago, is for Medicare to share savings with physician-and-hospital organizations — so-called accountable care organizations, or ACOs — that cut costs through more efficient utilization of services, while meeting certain quality standards.