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HHS: Affordable Care Act helped Medicare save $473 billion

As reform law turns six, Obama administration sets sights on broader goals

The Affordable Care Act has helped save the Medicare program hundreds of billions of dollars, according to the Obama adminstration. Now federal officials say they want to build on the law's gains in its first six years.

A report out Wednesday from the Department of Health and Human Services (HHS) shows that the Medicare program has spent $473 billion less from 2009 to 2014 than would have been spent if previous cost trends continued. If those lower cost trends are found to continue through 2015, the program could save as much as $648.6 billion, HHS says.

The report says the ACA's expansion of health coverage is responsible for the modest cost growth relative to past years. HHS said the ACA helped 20 million Americans gain insurance from 2010 to early 2016. There is also considerable evidence that these coverage gains were more due to the ACA than an increase in employer-based coverage tied to the resurgent economy, FierceHealthPayer has reported.

Yet in recognizing that "healthcare reform has always been about more than insurance," HHS is now planning to focus more on improving the healthcare system at large, Burwell writes in an opinion piece for Bloomberg.

To do that, the agency will step up its efforts to move to a value-based payment system, including finding smarter ways to pay for drugs, Burwell writes. Included in that effort is the agency's plan to test new Medicare Part B payment models--though that proposal has met with considerable backlash from providers and drug manufacturers.

HHS also wants to "increase consumer access and implement shared standards" for healthcare data, according to Burwell, as well as to improve the quality of care by encouraging better coordination and emphasizing wellness and prevention.

The agency also announced Wednesday that it wants to expand the ACA-funded Diabetes Prevention Program, which it says produced promising results in a demonstration involving the YMCA. Through the program, counselors help individuals develop healthier eating habits and increase their physical activity in order to stave off Type 2 diabetes.

"This program has been shown to reduce healthcare costs and help prevent diabetes, and is one that Medicare, employers and private insurers can use to help 86 million Americans live healthier," Burwell said.

To learn more:
- read the HHS report
- here's Burwell's opinion piece
- read the HHS announcement

Related Articles:
Affordable Care Act, not economy, drives health insurance gains
HHS touts 'historic' gain of 20M covered through Affordable Care Act
Feds reach alternative payment goal ahead of schedule
Feds to test new Medicare Part B payment models
Study: Diabetes prevention bill will cut Medicare costs, improve health
Medicaid expansion saves states millions, boosts payer revenues