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By  Director of Health Care Policy and Strategy David Martin

Last week, the Patrick-Murray Administration received a very encouraging response to a significant part of its plan to lower health care costs: 42 responses to our “request for information” (RFI) on the development of accountable care organizations (ACOs) in Massachusetts. This may seem interesting to only the “wonkiest” of health care policy types, but it should interest everyone concerned with the escalating costs of health care.  It’s an extremely positive sign that so many stakeholders responded to our questions about how best to create ACOs, one of the principal ways to coordinate health care and lower costs.

The responses came from every sector of the health care community: patient advocates, physicians, hospitals, employers, specialists, medical device companies, other providers and other industry advocates.

Essentially, ACOs are groups of doctors, hospitals, community health centers, nurses and potentially many other care providers organized to care for patients in a coordinated way.  The providers work together to care for patients in a way that increases the efficiency of the health care delivery system.  Providers will also be paid in a way that allows them to share in the savings they realize for providing care more efficiently.  These new payment methods are often referred to as “global payments,” but there are other payment methods being used by providers as well, for example, “shared savings” or “bundled payments.” 

Encouraging the formation of ACOs is one of the proposed methods that the Patrick-Murray Administration includes in its legislation to reduce health care costs and improve the quality of care for residents of the Commonwealth.  To understand more about what ACOs are, read Kaiser Health News’ FAQs on this topic for a more detailed explanation.

The RFI we issued asks interested parties how they would like to see ACOs take shape.  We will use the responses to write a more formal, “request for proposal” (RFP) to ask providers and payers that are reimbursed by the state to partner with us in caring for patients, using the ACO model.  This model will not only improve the quality of care patients receive, it will lower the cost of care that the state covers annually.

Although the RFI/RFP process will take many more months to complete, it is truly exciting to see how engaged stakeholders are – even at this stage of the process!

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