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Changes in health care spending and quality 4 years into global payment.

ABSTRACT: Spending and quality under global budgets remain unknown beyond 2 years. We evaluated spending and quality measures during the first 4 years of the Blue Cross Blue Shield of Massachusetts Alternative Quality Contract (AQC).We compared spending and quality among enrollees whose physician organizations entered the AQC from 2009 through 2012 with those among persons in control states. We studied spending changes according to year, category of service, site of care, experience managing risk contracts, and price versus utilization. We evaluated process and outcome quality.In the 2009 AQC cohort, medical spending on claims grew an average of $62.21 per enrollee per quarter less than it did in the control cohort over the 4-year period (P<0.001). This amount is equivalent to a 6.8% savings when calculated as a proportion of the average post-AQC spending level in the 2009 AQC cohort. Analogously, the 2010, 2011, and 2012 cohorts had average savings of 8.8% (P<0.001), 9.1% (P<0.001), and 5.8% (P=0.04), respectively, by the end of 2012. Claims savings were concentrated in the outpatient-facility setting and in procedures, imaging, and tests, explained by both reduced prices and reduced utilization. Claims savings were exceeded by incentive payments to providers during the period from 2009 through 2011 but exceeded incentive payments in 2012, generating net savings. Improvements in quality among AQC cohorts generally exceeded those seen elsewhere in New England and nationally.As compared with similar populations in other states, Massachusetts AQC enrollees had lower spending growth and generally greater quality improvements after 4 years. Although other factors in Massachusetts may have contributed, particularly in the later part of the study period, global budget contracts with quality incentives may encourage changes in practice patterns that help reduce spending and improve quality. (Funded by the Commonwealth Fund and others.).

SUBMITTER: Song Z

PROVIDER: S-EPMC4261926 | biostudies-literature | 2014 Oct

REPOSITORIES: biostudies-literature

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Changes in health care spending and quality 4 years into global payment.

Song Zirui Z Rose Sherri S Safran Dana G DG Landon Bruce E BE Day Matthew P MP Chernew Michael E ME

The New England journal of medicine 20141001 18

<h4>Background</h4>Spending and quality under global budgets remain unknown beyond 2 years. We evaluated spending and quality measures during the first 4 years of the Blue Cross Blue Shield of Massachusetts Alternative Quality Contract (AQC).<h4>Methods</h4>We compared spending and quality among enrollees whose physician organizations entered the AQC from 2009 through 2012 with those among persons in control states. We studied spending changes according to year, category of service, site of care ...[more]

PMID: 25354104

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Project description:BackgroundPopulation-based global payment gives health care providers a spending target for the care of a defined group of patients. We examined changes in spending, utilization, and quality through 8 years of the Alternative Quality Contract (AQC) of Blue Cross Blue Shield (BCBS) of Massachusetts, a population-based payment model that includes financial rewards and penalties (two-sided risk).MethodsUsing a difference-in-differences method to analyze data from 2006 through 2016, we compared spending among enrollees whose physician organizations entered the AQC starting in 2009 with spending among privately insured enrollees in control states. We examined quantities of sentinel services using an analogous approach. We then compared process and outcome quality measures with averages in New England and the United States.ResultsDuring the 8-year post-intervention period from 2009 to 2016, the increase in the average annual medical spending on claims for the enrollees in organizations that entered the AQC in 2009 was $461 lower per enrollee than spending in the control states (P<0.001), an 11.7% relative savings on claims. Savings on claims were driven in the early years by lower prices and in the later years by lower utilization of services, including use of laboratory testing, certain imaging tests, and emergency department visits. Most quality measures of processes and outcomes improved more in the AQC cohorts than they did in New England and the nation in unadjusted analyses. Savings were generally larger among subpopulations that were enrolled longer. Enrollees of organizations that entered the AQC in 2010, 2011, and 2012 had medical claims savings of 11.9%, 6.9%, and 2.3%, respectively, by 2016. The savings for the 2012 cohort were statistically less precise than those for the other cohorts. In the later years of the initial AQC cohorts and across the years of the later-entry cohorts, the savings on claims exceeded incentive payments, which included quality bonuses and providers' share of the savings below spending targets.ConclusionsDuring the first 8 years after its introduction, the BCBS population-based payment model was associated with slower growth in medical spending on claims, resulting in savings that over time began to exceed incentive payments. Unadjusted measures of quality under this model were higher than or similar to average regional and national quality measures. (Funded by the National Institutes of Health.).

Project description:The Medicare accountable care organization (ACO) programs rely on delivery system integration and health care provider risk sharing to lower spending while improving quality of care.To compare spending and quality between larger and smaller provider groups and examine how size-related differences vary by 2 factors considered central to ACO performance: group primary care orientation and financial risk sharing by health care providers.Using 2009 Medicare claims and linked American Medical Association Group Practice data, we assigned 4.29 million beneficiaries to health care provider groups based on primary care use. We categorized group size according to eligibility thresholds for the Shared Savings (?5000 assigned beneficiaries) and Pioneer (?15,000) ACO programs and distinguished hospital-based from independent groups. We assessed the primary care orientation of larger groups' specialty mix and used health maintenance organization market penetration and data from the Community Tracking Study to measure the extent of financial risk accepted by different types of provider groups in different areas for managed care patients. We estimated linear regression models comparing spending and quality between larger and smaller health care provider groups, allowing size-related differences to vary by measures of group primary care orientation and risk sharing. Spending and quality measures included total medical spending, spending by type of service, 5 process measures of quality, and 30-day readmissions, all adjusted for sociodemographic and clinical characteristics.Compared with smaller groups, larger hospital-based groups had higher total per-beneficiary spending in 2009 (mean difference, +$849), higher 30-day readmission rates (+1.3 percentage points), and similar performance on 4 of 5 process measures of quality. In contrast, larger independent physician groups performed better than smaller groups on all process measures and exhibited significantly lower per-beneficiary spending in counties where risk sharing by these groups was more common (-$426). Among all groups sufficiently large to participate in ACO programs, a strong primary care orientation was associated with lower spending, fewer readmissions, and better quality of diabetes care.Spending was lower and quality of care better for Medicare beneficiaries served by larger independent physician groups with strong primary care orientations in environments where health care providers accepted greater risk.

Project description:BackgroundIn 2009, Blue Cross Blue Shield of Massachusetts (BCBS) implemented a global payment system called the Alternative Quality Contract (AQC). Provider groups in the AQC system assume accountability for spending, similar to accountable care organizations that bear financial risk. Moreover, groups are eligible to receive bonuses for quality.MethodsSeven provider organizations began 5-year contracts as part of the AQC system in 2009. We analyzed 2006-2009 claims for 380,142 enrollees whose primary care physicians (PCPs) were in the AQC system (intervention group) and for 1,351,446 enrollees whose PCPs were not in the system (control group). We used a propensity-weighted difference-in-differences approach, adjusting for age, sex, health status, and secular trends to isolate the treatment effect of the AQC in comparisons of spending and quality between the intervention group and the control group.ResultsAverage spending increased for enrollees in both the intervention and control groups in 2009, but the increase was smaller for enrollees in the intervention group--$15.51 (1.9%) less per quarter (P=0.007). Savings derived largely from shifts in outpatient care toward facilities with lower fees; from lower expenditures for procedures, imaging, and testing; and from a reduction in spending for enrollees with the highest expected spending. The AQC system was associated with an improvement in performance on measures of the quality of the management of chronic conditions in adults (P<0.001) and of pediatric care (P=0.001), but not of adult preventive care. All AQC groups met 2009 budget targets and earned surpluses. Total BCBS payments to AQC groups, including bonuses for quality, are likely to have exceeded the estimated savings in year 1.ConclusionsThe AQC system was associated with a modest slowing of spending growth and improved quality of care in 2009. Savings were achieved through changes in referral patterns rather than through changes in utilization. The long-term effect of the AQC system on spending growth depends on future budget targets and providers' ability to further improve efficiencies in practice. (Funded by the Commonwealth Fund and others.).

Project description:IntroductionAlthough effects of alternative payment models on health outcomes and health spending are unclear, they are increasingly implemented in maternity care. We aimed to provide an overview of alternative payment models implemented in maternity care, describing their key design elements among which the type of APM, the care providers that participate in the model, populations and care services that are included and the applied risk mitigation strategies. Next to that, we made an inventory of the empirical evidence on the effects of APMs on maternal and neonatal health outcomes and spending on maternity care.MethodsWe searched PubMed, Embase and Scopus databases for articles published from January 2007 through October 2020. Search key words included 'alternative payment model', 'value based payment model', 'obstetric', 'maternity'. English or Dutch language articles were included if they described or empirically evaluated initiatives implementing alternative payment models in maternity care in high-income countries. Additional relevant documents were identified through reference tracking. We systematically analyzed the initiatives found and examined the evidence regarding health outcomes and health spending. The process was guided by the Preferred Reporting Items for Systematic Reviews and Meta-Analysis (PRISMA) to ensure validity and reliability.ResultsWe identified 17 initiatives that implemented alternative payment models in maternity care. Thirteen in the United States, two in the United Kingdom, one in New Zealand and one in the Netherlands. Within these initiatives three types of alternative payment models were implemented; pay-for-performance (n = 2), shared savings models (n = 7) and bundled payment models (n = 8). Alternative payment models that shifted more financial accountability towards providers seemed to include more strategies that mitigated those risks. Risk mitigation strategies were applied to the included population, included services or at the level of total expenditures. Of these seventeen initiatives, we found four empirical effect studies published in peer-reviewed journals. Three of them were of moderate quality and one weak. Two studies described an association of the alternative payment model with an improvement of specific health outcomes and two studies described a reduction in medical spending.ConclusionsThis study shows that key design elements of alternative payment models including risk mitigation strategies vary highly. Risk mitigation strategies seem to be relevant tools to increase APM uptake and protect providers from (initially) bearing too much (perceived) financial risk. Empirical evidence on the effects of APMs on health outcomes and spending is still limited. A clear definition of key design elements and a further, in-depth, understanding of key design elements and how they operate into different health settings is required to shape payment reform that aligns with its goals.

Project description:ImportancePrivate equity acquisitions of physician practices in the US have been increasing rapidly; however, the implications for health care delivery and spending are unclear.ObjectiveTo examine changes in prices and utilization associated with private equity acquisitions of physician practices across multiple specialties.Design, settings, and participantsThis was a difference-in-differences event study of US physician practices specialized in dermatology, gastroenterology, and ophthalmology that were acquired by private equity firms from 2016 to 2020. Within each specialty, each private equity-acquired (PE-acquired) practice was matched with as many as 5 control practices based on the preacquisition number of unique patients, encounters, risk score, share of services billed out-of-network, and spending. The PE-acquired practices were compared with matched controls through year 2 after acquisition, using a difference-in-differences event study. Data analyses were performed from March 2021 to February 2022.ExposuresPrivate equity acquisition of physician practices.Main outcomes and measuresMeasures of spending and utilization, including the charge and price (amount paid) per claim, new and unique patients, and total encounters.ResultsCompared with the 2874 control practices, the 578 PE-acquired physician practices exhibited an average increase of $71 (+20.2%) charged per claim (95% CI, 13.1%-27.3%; P < .001) and $23 (+11.0%) in the allowed amount per claim (95% CI, 5.6%-16.5%; P < .001). The PE-acquired practices increased their numbers of unique patients seen by 25.8% (95% CI, 15.8%-35.6%; P < .001) compared with control practices, driven by a 37.9% increase in visits by new patients (95% CI, 25.6%-50.2%; P < .001). In aggregate, their volume of encounters increased by 16.3% (95% CI, 1.0%-32.0%; P = .04) compared with the control group, with a 9.4% increase in the share of office visits for established patients that were billed as longer than 30 minutes (95% CI, 1.7%-17.0%; P = .02). No statistically significant changes in patient risk scores were found between PE-acquired practices and controls. Within specialties, we found modest differences along selected outcomes.Conclusions and relevanceIn this difference-in-differences study, private equity acquisition of physician practices in dermatology, gastroenterology, and ophthalmology were associated with differential increases in allowed amount and charges per claim, volume of encounters, and new patients seen, as well as some changes in billing and coding.

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Changes in health care spending and quality 4 years into global payment.

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Changes in health care spending and quality 4 years into global payment.

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