Four San Francisco hospitals, a physicians group and a managed-care organization have entered into an accountable care agreement targeting healthcare for University of California employees who live or work in the surrounding Bay Area.

The participants include Health Net of California, Hill Physicians Medical Group, UCSF Medical Center, UCSF Benioff Children's Hospital, St. Mary's Medical Center and St. Francis Memorial Hospital.

"This arrangement is modeled on the structure of ACOs, aligning incentives and promoting better care coordination, which is an important element of improving health," said Darryl Cardoza, CEO of Hill Physicians, referring in a news release to the CMS' Medicare Shared Savings Program.

Glenna Vaskelis, senior vice president of operations for the Bay Service Area of Dignity Health, which owns St. Mary's Medical Center and St. Francis Memorial Hospital, said the agreement will improve provider-to-provider and provider-to-patient communication and will pave the way for cost savings.

Last month, insurance giant Aetna announced an accountable care initiative with PrimeCare Medical Network, a California-based physicians group.