May 2, 2011

Related Links

View Dr. Safran's slide presentation.

BCBSMA launched the AQC in 2009 to move away from fee-for-service reimbursement models, with the goal of improving quality and outcomes while simultaneously slowing the growth of health care spending. Dr. Safran laid out five key elements of the model:

  • Contracted providers take accountability for the full spectrum of patient care, total medical expenses, and patient outcomes from prenatal to end-of-life care.
  • Participating providers enter into a five-year contract (in contrast to the standard contracts of one to three years) in recognition that the process requires a long-term commitment to changing care delivery.
  • Contracts are based on a global budget, and are negotiated based on providers’ historical rates of spending. If providers identify savings, they keep or share those savings under this model. BCBSMA also provides a technical assistance team to help participants track financial and patient data to develop strategies for reducing wasteful spending.
  • The rate of rise in the global budget is much smaller than typical, with a tie to overall inflation.
  • Finally, the AQC includes quality incentives. Providers have an opportunity to earn up to an additional 10% bonus for reaching a range of quality targets.

Dr. Safran calls the first-year results of the AQC “nothing short of dazzling.” The AQC members’ performance was three times that of non-AQC groups, and participants more than doubled their own improvement rates.

On the quality side, progress was especially good on clinical outcomes in areas such as diabetes and cardiovascular care, where there are solidly established, evidence-based guidelines for care.

On the finance side, all AQC participants achieved budget surpluses in the first year, allowing them to invest in infrastructure such as health information technology to improve care.

What is driving the improvement? Dr. Safran noted that the global payment model has liberated providers from the mindset that they can only deliver care attached to a specific billing code. The AQC members are also using data to make smarter decisions about health care delivery and purchasing. Providers can see whether there are variations in practice among the providers in their group (for example, differences in which drugs are being prescribed or in referral patterns) and make adjustments to improve quality and reduce costs. They also receive patient data, sometimes even daily, that can help them deliver more focused interventions to improve that patient’s care and outcomes through more intensive care coordination or follow-up.

The AQC embodies many of the payment experiments contained in the Affordable Care Act, including accountable care organizations. As providers and payers grapple with what a reformed health care delivery system looks like in practice, the AQC is a promising model for improving quality and slowing the growth of health care costs.

Back to Event Recaps