• A tightening of Medicare’s hospital “productivity adjustment,” which lowered the prices paid by the program.
  
• Adjustments to Medicare’s annual updates of provider payment rates.
  
• Lower payment rates for private Medicare Advantage plans.
  
• Strong incentives to reduce hospital readmission rates and infections.
  
• New payment methods for holding health care providers and systems more accountable for the quality and cost of care they provide.
  

• For example, by curtailing excessive Medicare payments to private insurers and medical providers, the law has contributed Recent Trends in Health Care Costs, Their Impact on the Economy, and the Role of | 149 the Affordable Care Act to the recent slow growth in health care prices and spending, reducing health care price inflation by an estimated 0.2 percentage points each year since 2010. 
  
• hospital readmission rates have turned sharply lower since the ACA began penalizing hospitals that readmit a larger number of patients soon after discharge.  
  
• Similarly, the ACA has substantially increased health care provider participation in payment models designed to promote high-quality, integrated care.  
  
• An emerging literature also suggests that the ACA’s payment reforms, which operate primarily through Medicare (and, to a lesser extent, through Medicaid), may generate “spillover” benefits throughout the health system. This literature finds that when Medicare reduces payments to medical providers, private payers tend to follow suit, and also finds that the same is true for changes to the structure of how Medicare pays providers. Some recent evidence also suggests that changes in payment structures by one insurer may benefit patients covered by other insurers, even if those other insurers do not adopt the new payment structures.  
  

Quote:A few years ago, under the authority of the Affordable Care Act, the federal government started an experiment: It would pay hospitals a single amount for surgeries to replace joints like knees and hips instead of paying them for each individual service. The hope was that hospitals could lower costs while maintaining or even improving the quality of care. The program was called “bundled payments,” and it was voluntary under the Obama administration — hospitals could opt in or out. Almost immediately, it seemed to be working. Costs per procedure were going down, and quality seemed to stabilize or even improve. Hospitals didn’t have to worry about squeezing every dollar they could out of Medicare and could start focusing more on the care itself.

But some health economists had two outstanding fears: Would hospitals start performing more surgeries, which would erase any savings to Medicare? And would they start becoming more selective about their patients to avoid particularly costly ones? According to new research led by Ezekiel Emanuel and Amol Navathe at the University of Pennsylvania published Tuesday in JAMA, the answer to both is: no, not really. The volume of procedures isn’t going up, and for the most part, the kind of patients receiving replacements isn’t changing, either..