Coordination, value-based payment didn't save Medicare dollars

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Efforts to cut Medicare spending and improve care quality have largely failed, according to a new report from the Congressional Budget Office (CBO).

After two decades of trying to shift toward rewarding quality care, disease management and care coordination demonstrations and value-based payment demonstrations have not reduced Medicare spending, CBO said in a blog post yesterday.

The report found that, on average, the 34 disease management and care coordination programs designed to improve the quality of care for chronically ill Medicare patients barely affected hospital admissions. For almost every program, spending stayed the same or, after considering the fees paid to participating organizations, it rose.

Meanwhile, most of the value-based payment demonstrations, which allowed large multi-specialty physician groups to share in savings or offered hospitals bonuses for meeting certain quality metrics, led to little or no Medicare savings.

However, one value-based payment demo, in which Medicare made bundled payments covering all hospital and physician services for heart bypass surgeries, saw Medicare spending drop by about 10 percent, according to the report.

The CBO said the findings show the industry still needs major payment and healthcare delivery transformations to overcome the fee-for-service model.

To create demonstrations that promote the delivery of low-cost, high-quality care, CBO recommended healthcare providers collect timely utilization and hospital admission data, apply team-based care and target high-risk Medicare enrollees, CBO noted.

To learn more:
- check out the report (.pdf)
- here's the CBO blog post

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