Medicare Project Aimed at Increasing Efficiency Yields Mixed Results
Medicare's five-year-old pilot project to measure the success of group physician practices has produced mixed results, as practices have increased quality but have failed to reduce costs as much as predicted, the Fiscal Times/Kaiser Health News reports.
The project, which was launched in 2005, measured 10 physician groups' adherence to 32 different procedures that previously proved successful in lowering costs and resulting in better patient outcomes.
CMS funded some of the startup costs with the expectation that if groups improved their performance on certain measures from one year to the next, and if their costs rose less than other Medicare providers in their area, they would receive 80% of the resulting savings.
CMS found that by 2008:
- All 10 groups achieved high levels of performance;
- All 10 groups achieved pre-specified benchmarks on 28 of the 32 quality measures;
- Two groups -- Geisinger Health System and Park Nicollet Health Services -- surpassed their goals on all 32 quality measures; and
- Five groups reduced costs.
Debate Continues Over Pilot Projects
Health policy experts note that pilot projects so far raise questions about the high expectations for the dozens of demonstration projects authorized by the health reform law, the Times/KHN reports.
The overhaul allotted $10 billion for such projects, and their potential for savings has been heavily debated. For example, the Congressional Budget Office projected just $1.3 billion in savings from all the projects under the overhaul.
At a forum to discuss demonstration projects held last week, Joseph Antos of the American Enterprise Institute said, "Unfortunately, the track record for pilot projects hasn't been that great. Why is this time different?"
However, Urban Institute physician-scholar Robert Berenson said, "The idea that there have been no successes in 35 years of demonstration projects is just not right." He noted the success of projects that bundled payments for acute care episodes and a pilot pay-for-performance program for improving hospital quality.
According to the Times/KHN, CMS officials ultimately hope the projects move Medicare away from the fee-for-service model, but experts say they need to be designed, implemented and validated much quicker to affect Medicare spending (Goozner, Fiscal Times/Kaiser Health News, 10/28).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.