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The great Medicare cost-control experiment begins

Bloomberg BusinessWeek, September 7, 2012

As part of the 2010 Obamacare law, hospitals agreed to take a 1 percent cut in reimbursements—about $850 million—which they can earn back if they do a good job. Researchers say the overall amount of money at play is too small to actually change the way hospitals behave. Based on how hospitals currently score on these metrics, most hospitals would break even; they’ll get back enough in bonuses to recover the 1 percent loss, write Dr. Rachel Werner and Dr. R. Adams Dudley in a paper published this week in the journal Health Affairs.