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

Abstract

Background: 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).

Methods: 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.

Results: 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.

Conclusions: 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.).

Figure 1. Unadjusted Spending in the 2009 Alternative Quality Contract (AQC) Cohort versus the Control Group, 2006–2012

Panel A shows the total unadjusted spending. Panel B shows the results according to site of care (inpatient [IP] or outpatient [OP]) and type of claim (facility [Fac] or professional [Prof]). The control group comprised commercially insured enrollees in employer-sponsored plans across eight Northeastern states: Connecticut, Maine, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont. The vertical line at the start of 2009 indicates the start of the AQC period.

Figure 2. Outcome Quality in the 2009 AQC Cohort versus the Healthcare Effectiveness Data and Information Set (HEDIS), 2007–2012

Outcome quality consisted of the following five measures: control of the glycated hemoglobin level (≤9%), control of the low-density lipoprotein (LDL) cholesterol level (<100 mg per deciliter [2.6 mmol per liter]), and blood-pressure control (<140/80 mm Hg) in patients with diabetes; the same level of control of LDL cholesterol in patients with coronary artery disease; and a blood-pressure control level of 140/90 mm Hg in patients with hypertension.