A new Commonwealth Fund report takes a close look at one of the central elements of the emerging world of accountable care — whether the many shared savings experiments of the last few years will live up to their lofty goals of better quality at a lower cost, all while finding a sustainable way to reward hospitals and other participants for their efforts.
It's an issue that every medical home, accountable care organization or provider/payer partnership will have to address to be successful, and the report looked at 27 programs that employ the shared-savings model, most of which were launched in 2010 or 2011. In particular, the report raised three key issues that should give all would-be shared savers pause:
The necessity of determining if savings have actually been achieved, which the study identified as a potentially "increasing source of conflict."
The idea that shared savings programs are dependent on generating shared savings sounds more like a Yogi Berra quote than a white paper finding, but it emerged in the research as a major potential issue. "Payers and providers must resolve the tension between statistical certainty that savings have been realized and providing a meaningful and attainable incentive for providers to generate savings," the report states.
Despite the value in experimentation, competing shared savings models may cause providers confusion if too many performance measures are created as a result.
If that happens, the report argues that "providers may find it difficult to focus." This, of course, is a persistent issue in the world of quality performance measures, but I hadn't considered it in this particular context before. And it also raises the key, somewhat counterintuitive point of whether too much experimentation with payment models will overwhelm hospitals and other providers.
Developing the competencies to effectively participate in a shared savings program may be harder for smaller organizations.
"The largest provider organizations have invested heavily in consulting services, process redesign, and infrastructure development, but not all provider organizations have the capacity to do so. Smaller provider organizations and those in poor financial health may have great difficulty responding to the incentive presented by the opportunity to share savings." That's a sobering thought for smaller hospitals who may be hoping to achieve gains by partnering with other moderately sized providers to leverage their combined community resources. And it raises the question of whether rural providers will have as much success in shared savings programs as those in large metropolitan areas.
It's a worthwhile read, and it brings up questions that all hospitals should consider before joining a shared savings program. Not the least of which, it turns out, is being able to know if those savings actually exist.