updated 4/21/2004 1:03:14 PM ET 2004-04-21T17:03:14

Medicare is hoping to save money by offering hundreds of thousands of older and disabled Americans coordinated care to manage their chronic illnesses.

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The government is planning to launch 10 Medicare chronic care programs by the end of the year, Mark McClellan, administrator of the federal Centers for Medicare and Medicaid Services, said Tuesday.

By regularly monitoring people with diabetes, asthma, congestive heart failure and other chronic diseases, coordinated care is intended to prevent a medical crisis that could send the patient to the hospital.

These patients use up most health care dollars. The companies that coordinate patient care must show at least a 5-percent drop in the cost of health care claims or risk not getting paid.

Proponents of disease management say that they’re seeing savings from programs already in place on a small scale.

The chronic care program was included in the Medicare law enacted last year. The pilot projects, each involving 15,000 to 30,000 people, are supposed to last three years and provide the basis for a national chronic care program.

Health and Human Services Secretary Tommy Thompson said the average older person sees seven doctors and uses 20 prescription medicines a year.

“Too many seniors are suffering from fragmented care,” Thompson said Tuesday at a news conference.

Gerard D’Amore, 80, of Rockville, Md., described his regular telephone conversations with a woman who works for a disease management company that monitors D’Amore’s diabetes.

“For the first time I began to feel friendly with my diabetes,” said D’Amore, who is enrolled in a health maintenance organization. “I began to understand it. I began not to fear it or resent it.”

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