Trump Administration to Overhaul a Program Designed to Save Medicare Money

The Trump administration has proposed to revamp an Affordable Care Act program designed to control soaring Medicare costs by encouraging doctors and hospitals to work together to coordinate patients' care, reports National Public Radio . Using the argument that accountable care organizations (ACOs) have led to higher Medicare spending, the administration could drastically shrink the number of participating health providers. About 82 percent of the 561 Medicare ACOs are currently set up so that they are not at risk of losing money from Medicare, sharing in any savings they realize. The remaining 18 percent can obtain a higher share of savings, but also risk paying back money to Medicare if they fail to meet their savings targets. Medicare officials say those ACOs have been more successful in saving money. The White House plans to phase out the no-risk model starting in 2020, but a poll found 70 percent of ACOs would rather quit than assume such financial risk. Centers for Medicare and Medicaid Services Administrator Seema Verma says it is unreasonable to have ACOs that can only make profits but not risk any losses. Current ACOs will have 12 months to transition to a model accepting financial risk while new ACOs will have 24 months, earning Medicare $2.2 billion in savings over the next decade.