Health affairs
-
Many health policy analysts envision provider payment reforms currently under development as replacements for the traditional fee-for-service payment system. Reforms include per episode bundled payment and elements of capitation, such as global payments or accountable care organizations. ⋯ It is therefore critical to address the current shortcomings in the Medicare physician fee schedule, because it will affect physician incentives and will continue to play an important role in determining the payment amounts under payment reform. This article reviews how the current payment system developed and is applied, and it highlights areas that require careful review and modification to ensure the success of broader payment reform.
-
Medicare's new hospital pay-for-performance program for all acute care hospitals will begin in October 2012. It will be the largest Medicare quality improvement initiative for hospitals to date. Using 2009 data on hospital performance, we calculated hospital performance scores and projected payments under the new program for all eligible hospitals. ⋯ Almost two-thirds of hospitals would experience changes of just a fraction of 1 percent. Although the program will in effect redistribute resources among hospitals, our data suggest that the redistribution is not likely to cause major problems because the amount being redistributed is also small. These results raise questions about whether the new pay-for-performance program will substantially alter the quality of hospital care, and they highlight the challenges of designing effective quality improvement incentives.
-
Policy makers have been trying to replace Medicare's fee-for-service payment system for years with approaches that pay one price for an aggregation of services. The intent is to reward providers for offering needed care in the most appropriate and cost-effective manner. Medicare's first payment change designed to accomplish such a change was the hospital prospective payment system, introduced during 1983-84. ⋯ The goal of Medicare's current bundled payment initiative is to provide incentives to deliver health care more efficiently while maintaining or improving quality. This article provides a detailed analysis of how Medicare implemented the hospital prospective payment system, how hospitals responded to the new incentives, and lessons learned that are applicable to the bundled payment initiative. The lessons include that any Medicare payment reform needs to continuously respond to the many different components of the health system and that payment reform should be coupled with analogous reforms in private insurance payment, so that providers receive consistent signals to alter their behavior.
-
Decision aids are evidence-based sources of health information that can help patients make informed treatment decisions. However, little is known about how decision aids affect health care use when they are implemented outside of randomized controlled clinical trials. ⋯ Consistent with prior randomized trials, our introduction of decision aids was associated with 26 percent fewer hip replacement surgeries, 38 percent fewer knee replacements, and 12-21 percent lower costs over six months. These findings support the concept that patient decision aids for some health conditions, for which treatment decisions are highly sensitive to both patients' and physicians' preferences, may reduce rates of elective surgery and lower costs.