Using Shared-Savings Strategies to Cut Health Care Costs
<p>New approaches to health care payment that encourage providers to reduce medical spending by allowing them to share in the net savings have attracted considerable interest recently. For a new <a href="/publications/issue-briefs/2011/aug/key-design-elements-shared-savings-payment-arrangements">Commonwealth Fund issue brief</a>, Michael Bailit and Christine Hughes interviewed leaders at payer and provider organizations and state agencies about their shared-savings approaches. These wide-ranging approaches have been driven by the push for performance-based payment for medical homes and other providers, as well as the Affordable Care Act's accountable care organization provisions.</p>
<p>The brief discusses the kinds of patient populations and health care services that are covered under current shared-savings plans, how providers are assigned to patients, the use of risk adjustment, and the way savings are calculated and distributed.</p>
<p>Bailit and Hughes also lay out the key issues that payers and providers will need to resolve to enhance the success of shared-savings plans, including how to ensure shared savings are not just the result of random variations in health care costs, what performance measures should be used, and how to equip providers with the data and other tools they need to improve their effectiveness and efficiency. <br /><br /></p>