Zirui Song

Workplace Wellness Programs Can Generate Savings

Amid soaring health spending, there is growing interest in workplace disease prevention and wellness programs to improve health and lower costs. In a critical meta-analysis of the literature on costs and savings associated with such programs, we found that medical costs fall by about

The ‘Alternative Quality Contract,’ Based On A Global Budget, Lowered Medical Spending And Improved Quality

3.27 for every dollar spent on wellness programs and that absenteeism costs fall by about

Changes in Health Care Spending and Quality 4 Years into Global Payment

2.73 for every dollar spent. Although further exploration of the mechanisms at work and broader applicability of the findings is needed, this return on investment suggests that the wider adoption of such programs could prove beneficial for budgets and productivity as well as health outcomes.

Who Ordered That? The Economics of Treatment Choices in Medical Care

Seven provider organizations in Massachusetts entered the Blue Cross Blue Shield Alternative Quality Contract in 2009, followed by four more organizations in 2010. This contract, based on a global budget and pay-for-performance for achieving certain quality benchmarks, places providers at risk for excessive spending and rewards them for quality, similar to the new Pioneer Accountable Care Organizations in Medicare. We analyzed changes in spending and quality associated with the Alternative Quality Contract and found that the rate of increase in spending slowed compared to control groups, more so in the second year than in the first. Overall, participation in the contract over two years led to savings of 2.8 percent (1.9 percent in year 1 and 3.3 percent in year 2) compared to spending in nonparticipating groups. Savings were accounted for by lower prices achieved through shifting procedures, imaging, and tests to facilities with lower fees, as well as reduced utilization among some groups. Quality of care also improved compared to control organizations, with chronic care management, adult preventive care, and pediatric care within the contracting groups improving more in year 2 than in year 1. These results suggest that global budgets with pay-for-performance can begin to slow underlying growth in medical spending while improving quality of care.

The Era of Delivery System Reform Begins

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

Using propensity scores in difference-in-differences models to estimate the effects of a policy change

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.).

Massachusetts Health Care Reform and Reduced Racial Disparities in Minimally Invasive Surgery

In the United States, two patients with the same medical condition can receive drastically different treatments. In addition, the same patient can walk into two physicians’ offices and receive equally disparate treatments. This chapter attempts to understand why. It focuses on three areas: the patient, the physician, and the clinical situation. Specifically, the chapter surveys patient or demand-side factors such as price, income, and preferences; physician or supply-side factors such as specialization, financial incentives, and professionalism; and situational factors including behavioral influences and systems-level factors that play a role in clinical decision making. This chapter reviews theory and evidence, borrowing heavily from the clinical literature.

Controlling Health Care Spending — The Massachusetts Experiment

Health care reform evolves in distinct phases. Insurance reform, the critical first step, has been established with the 2010 Affordable Care Act. The nation now enters payment reform, a second chapter motivated by the need to slow health care spending. Payers across the country are increasingly putting health care on a budget, moving from fee-for-service to lump-sum payments for bundles of services or populations of patients. Hospitals, health care centers, and physicians, in turn, are consolidating into Accountable Care Organizations (ACOs) to address these new payment contracts, which reward lower spending and higher quality. In July, 89 new ACOs were launched in Medicare. Combined with 59 Medicare ACOs started in January, these organizations bring more than 130,000 physicians and 2.2 million beneficiaries into a new approach of organization-based health care.1 Global budget contracts from private insurers are doing the same for millions more working-age adults, their families, and their physicians.2 While insurance and payment reform have dominated policy attention, the third phase of health care reform—delivery system reform—has largely been ignored. Quietly underway in many parts of the country, this phase focuses attention on the culture of medicine. Its main actors are different. Where policymakers and economists led on insurance reform and payment reform, delivery system reform shines a spotlight on the modern physician organization, and asks these organizations to lead a cultural shift towards lower cost, higher value health care. In today’s environment, the modern physician organization must be large enough to manage population health, nimble enough to cultivate teamwork across multiple specialties, and small enough to give each patient a home for his or her care. As physicians merge into ACOs, these organizations are assuming a variety of sizes and structures. Accountable care organizations in Medicare range from small group practices, to practices banded with hospitals, to integrated delivery systems consisting of academic medical centers and thousands of clinicians (Figure). From this starting point, little is known about how organizations can manufacture teamwork, about how they can overcome the historic silos of specialization to promote joint accountability, and about how they can turn a habit for volume into a passion for value. Figure Organizational Attributes of ACOs in the Medicare Shared Savings Program* Although some physician organizations were created with cultures that prepared them to be ACOs, such as Kaiser Permanente and Geisinger Health System, little is known about how to change the culture of organizations that began with a different DNA. Yet changing the culture of practice—beyond financial incentives and penalties and beyond merely putting clinicians under the same roof—is the best long-run hope for slowing spending from the ground up. Policy makers may help align incentives, but to truly shift medical practice, physicians must take the lead. How does the modern physician organization embark on delivery system reform? The process begins with recognizing that “organizational knowledge,” which motivates the culture of practice, comes from organizational learning.3-4 In this era of delivery system reform, 3 domains are important building blocks for such learning. First is leadership. The modern physician organization needs leaders who can motivate an organizational ethos that complements the professional ethos of medicine; not only is there a sacred patient-physician relationship, there is an equally important physician-physician relationship. In a global payment world, clinicians in an organization are truly in it together. When a physician chooses against an unnecessary test, savings accrue to the organization. When a case manager calls a patient and prevents an unnecessary visit to the emergency department, the organization benefits. When patients are satisfied with their care, the organization is rewarded. The modern physician organization must motivate its members to feel invested in one another. Organizations must value the clinician who counsels a patient about smoking as much as the one who removes the cancerous lung. This will require leadership that can unite clinicians in a shared vision as well as keep them together through difficult trade-offs. Shifting global payment dollars from inpatient care to primary care or from certain specialty services to others may be necessary, with potential implications for the composition of the physician workforce. Second is incentives. The modern physician organization needs its clinicians to improve the collective value of their care, rather than advocate solely for their own portfolios of work. A focus on collective value orients the organization toward clinical benefit per dollar, encouraging reflections about how physicians work with one another, consult one another, and refer patients to one another, all of which affect resource utilization. Financial and nonfinancial incentives that reward value, particularly through teamwork, need to be carefully designed. Some organizations seem capable of delivering high-value care with physicians on salary. Other organizations have developed creative incentives to motivate physicians to care about their colleagues’ patients as well as their own.5 Still others have found new ways to measure and motivate team performance around common clinical scenarios, such as myocardial infarction and stroke.6 In designing incentives, the modern physician organization will likely benefit from an understanding of the behavioral economics of physician decision making and the emerging sociology of physician networks.7-8 Third is the patient’s role. The modern physician organization benefits not only when patients are satisfied with their physician, but also when patients are satisfied with the organization that integrates their care. The organization benefits not only when patients feel invested in their care, but also when the organization invests in its patients. To be sure, this reciprocity must be earned, but earning it is critical to reducing unnecessary spending. The economics of ACOs puts physicians and patients on the same team. As beneficial as reducing the supply of unnecessary care may be, reducing the demand for it is just as important. Adherence to medication regimens is key; judicious use of the emergency department even more so. For population health management to work, the population must feel empowered to manage its health. Indeed, the organization must motivate patients to actively partake in its mission, rather than simply be the means to its mission. In an increasingly constrained health care environment, the imperative for medicine to look deep within itself is stronger than ever. Modern physician organizations must provide leadership for a health care system that needs a common vision. Undoubtedly, these organizations will compete—for patients, for physicians, and for resources. But through their size, influence, and training of new physicians, they are endowed with the opportunity to lead. Physician organizations will need help, not just from patients, but also from payers at the bargaining table, drug companies at the checkout line, and a legal system that protects physicians when choosing against unnecessary care. But if these organizations can begin to shift the culture of medicine—if they can find ways to deliver better care at lower cost—they can begin to navigate health care through the era of delivery system reform.

Mobile Clinic In Massachusetts Associated With Cost Savings From Lowering Blood Pressure And Emergency Department Use

Abstract Difference-in-difference (DD) methods are a common strategy for evaluating the effects of policies or programs that are instituted at a particular point in time, such as the implementation of a new law. The DD method compares changes over time in a group unaffected by the policy intervention to the changes over time in a group affected by the policy intervention, and attributes the “difference-in-differences” to the effect of the policy. DD methods provide unbiased effect estimates if the trend over time would have been the same between the intervention and comparison groups in the absence of the intervention. However, a concern with DD models is that the program and intervention groups may differ in ways that would affect their trends over time, or their compositions may change over time. Propensity score methods are commonly used to handle this type of confounding in other non-experimental studies, but the particular considerations when using them in the context of a DD model have not been well investigated. In this paper, we describe the use of propensity scores in conjunction with DD models, in particular investigating a propensity score weighting strategy that weights the four groups (defined by time and intervention status) to be balanced on a set of characteristics. We discuss the conceptual issues associated with this approach, including the need for caution when selecting variables to include in the propensity score model, particularly given the multiple time point nature of the analysis. We illustrate the ideas and method with an application estimating the effects of a new payment and delivery system innovation (an accountable care organization model called the “Alternative Quality Contract” (AQC) implemented by Blue Cross Blue Shield of Massachusetts) on health plan enrollee out-of-pocket mental health service expenditures. We find no evidence that the AQC affected out-of-pocket mental health service expenditures of enrollees.

Two-Year Impact of the Alternative Quality Contract on Pediatric Health Care Quality and Spending

IMPORTANCE Racial disparities in receipt of minimally invasive surgery (MIS) persist in the United States and have been shown to also be associated with a number of driving factors, including insurance status. However, little is known as to how expanding insurance coverage across a population influences disparities in surgical care. OBJECTIVE To evaluate the impact of Massachusetts health care reform on racial disparities in MIS. DESIGN, SETTING, AND PARTICIPANTS A retrospective cohort study assessed the probability of undergoing MIS vs an open operation for nonwhite patients in Massachusetts compared with 6 control states. All discharges (n = 167,560) of nonelderly white, black, or Latino patients with government insurance (Medicaid or Commonwealth Care insurance) or no insurance who underwent a procedure for acute appendicitis or acute cholecystitis at inpatient hospitals between January 1, 2001, and December 31, 2009, were assessed. Data are from the Hospital Cost and Utilization Project State Inpatient Databases. INTERVENTION The 2006 Massachusetts health care reform, which expanded insurance coverage for government-subsidized, self-pay, and uninsured individuals in Massachusetts. MAIN OUTCOMES AND MEASURES Adjusted probability of undergoing MIS and difference-in-difference estimates. RESULTS Prior to the 2006 reform, Massachusetts nonwhite patients had a 5.21-percentage point lower probability of MIS relative to white patients (P < .001). Nonwhite patients in control states had a 1.39-percentage point lower probability of MIS (P = .007). After reform, nonwhite patients in Massachusetts had a 3.71-percentage point increase in the probability of MIS relative to concurrent trends in control states (P = .01). After 2006, measured racial disparities in MIS resolved in Massachusetts, with nonwhite patients having equal probability of MIS relative to white patients (0.06 percentage point greater; P = .96). However, nonwhite patients in control states without health care reform have a persistently lower probability of MIS relative to white patients (3.19 percentage points lower; P < .001). CONCLUSIONS AND RELEVANCE The 2006 Massachusetts insurance expansion was associated with an increased probability of nonwhite patients undergoing MIS and resolution of measured racial disparities in MIS.