Vt. Hospitals Take Big Health Care Overhaul Step

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Officials from Burlington’s Fletcher Allen Health Care, Dartmouth Hitchcock Medical Center and other hospitals serving Vermont have joined to create the nation’s first statewide "accountable care organization" – or ACO.

Today’s announcement means about 42,000 of Vermont’s 118,000 Medicare beneficiaries will get their care from the new entity. ACO’s are called for under the federal health care overhaul law of 2010.

They’re designed to improve health care and save money by moving away from the traditional "fee for service" system in which providers get paid every time they do a procedure, to one in which expenditures to cover a set number of patients are agreed to ahead of time.

Aside from the two big teaching hospitals, the effort includes 14 other Vermont hospitals and five rural health clinics.

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