The ‘Alternative Quality Contract’ in Massachusetts Based on Global Budgets Lowered Medical Spending and Improved Quality

摘要

Seven provider organizations in Massachusetts entered the Blue Cross Blue Shield Alternative Quality Contract in 2009, followed by four more organizations in 2010. This contract, based on a global budget and pay-for-performance for achieving certain quality benchmarks, places providers at risk for excessive spending and rewards them for quality, similar to the new Pioneer Accountable Care Organizations in Medicare. We analyzed changes in spending and quality associated with the Alternative Quality Contract and found that the rate of increase in spending slowed compared to control groups. Overall, participation in the contract over two years led to a savings of 3.3% (1.9% in year-1, 3.3% in year-2) compared to spending in groups not participating in the contract. The savings were even higher for groups whose previous experience had been only in fee-for-service contracting. Such groups’ quarterly savings over two years averaged 8.2% (6.3% in year-1, 9.9% in year-2). Quality of care also improved within organizations participating in the Alternative Quality Contract compared to control organizations in both years. Chronic care management, adult preventive care, and pediatric care improved from year 1 to year 2 within the contracting groups. These results suggest that global budgets coupled with pay-for-performance can begin to slow the underlying growth in medical spending while improving quality.