Return on Investment Forecasting: A Tool for Effective Policymaking
<p>Rather than cutting public insurance benefits or restricting eligibility, state and federal policymakers are increasingly recognizing that a more promising strategy for "bending the curve" in health care costs is to identify better ways to organize, finance, and deliver high-quality care. In a new Commonwealth Fund issue brief, researchers from the Center for Health Care Strategies (CHCS) illustrate how return on investment (ROI) forecasting can help Medicaid programs allocate resources efficiently and identify ways to maximize value in health care purchasing.</p>
<p>According to <a href="/Content/Publications/Issue-Briefs/2009/Apr/Maximizing-Quality-and-Value-in-Medicaid.aspx">Maximizing Quality and Value in Medicaid: Using Return on Investment Forecasting to Support Effective Policymaking</a>, ROI forecasting can help Medicaid officials identify program and infrastructure investments that have the potential to improve health outcomes while reducing health care costs and other state expenditures. For example, a state considering whether to focus a new care-management program on beneficiaries with diabetes or beneficiaries with congestive heart failure might be interested in which program would be more cost-effective over the next several years. Another state may need to choose between launching a new medical-home initiative and expanding a pay-for-performance program.</p><p>Knowing the potential ROI of each program can help inform choices about the best path to pursue.</p>