Amarillo, TX - A collaboration of area doctors, physicians and nurse practitioners is cutting local Medicare costs by millions.

About two years ago, the Amarillo Legacy Medical Accountable Care Organization (ALMA) formed here in Amarillo to streamline medicare services. Thursday they received results of how their efforts are keeping more patients out of the hospital and in turn, saving taxpayer's money.

ALMA serves 10,876 Medicare patients across the Panhandle.The organization created strategies for 109 local health care providers to work together to prevent illnesses before they cause costly hospitalizations.They did this by improving access to care, coordinating health care between providers and by exchanging health care information.

"This was kind of an experiment of sorts that for the first time competing groups could work together and design programs that would benefit their mutual patients in order to improve quality and save money," explained ALMA CEO and Medical Director Dr. William Biggs.

So far, Dr. Biggs said the collaboration experiment is working. Hospital admissions for Medicare patients in Amarillo are down 23 percent since 2012.

Overall, the actual cost per patient in 2013 compared to the expected cost saved Medicare $461 per patient. That may not seem like a lot, but when you multiply that number by the total amount of Medicare patients they served last year, it adds up to almost $5 million in savings. "We thought we might be able to save about $1 million for the year, so $5 million in our mind is a huge amount of money. It blows away our expectations," said Dr. Biggs.

Medicare does return a portion of the savings to ALMA's group of providers as an incentive to participate. They will use part of that money to improve their efficiency and save even more federal money. "We plan basically to use that to reinvest and expand the program," said Dr. Biggs. "We're going to expand our care management to have more staff that will do that, we're going to extend our health information exchange to include the hospitals and additional medical groups, and we hope to have other medical groups join us in the coming year so that we'll have more doctors included."

So far, Accountable Care Organizations across the nation said they have saved more than $372 million in Medicare services.

To view the full presentation on Amarillo's Accountable Care Organization, click here.

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Local health care providers save millions for Medicare