Chronic care bill could reduce Medicare, Medicaid spending by $217 million

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The bill was introduced by Sen. Orrin Hatch (R-UT).
The bill was introduced by Sen. Orrin Hatch (R-UT).

A bill designed to improve care for Medicare beneficiaries with chronic conditions could reduce spending by $217 million over five years, according to a new federal report.

S. 870, known as the “Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act of 2017,” aims to boost chronic care by giving beneficiaries flexibility to be part of an accountable care organization, expanding and improving telehealth services, and eliminating barriers to ACO care coordination, among other provisions.

In a report published Tuesday the Congressional Budget Office estimated that the legislation, if enacted, would save federal healthcare programs $217 million between fiscal years 2018 and 2022.

The majority of those direct spending reductions would be driven by the bill's provisions to expand telehealth services for MA plans, allow ACOs to offer financial incentives to beneficiaries receiving care from in-network providers, and rescind funding meant to improve the Medicare fee-for-service program.

Other provisions, including one to expand telehealth services for stroke patients, may initially drive up costs but reduce spending in the long run, the CBO said.

S. 870 was introduced by Sen. Orrin Hatch (R-UT) in April and approved by the Senate Finance Committee in May. Click here to see the full CBO report.