Using risk contracting to reduce service use, improve quality, and strengthen primary care.

Abstract

The high costs of American health care, the related problem of the uninsured, and the grim fiscal prognosis of Medicare and Medicaid are among the most pressing challenges facing the United States today. A solution to the cost problem that does not reduce access or quality is sought by those at all points on the political spectrum. This article discusses the experience of an independent practice association that has collaborated with a related business partner and a health plan to improve the quality of care of 16,000 Medicare Advantage beneficiaries while substantially reducing hospitalization rates and overall service use. The capacity to reduce service use frees funds that are used to support the infrastructure for high-value care and to reward those who provide it. Higher performing primary care, supported by changes in payment, has driven a sustainable business model that preserves the option of independent practice for physicians. We are now testing competencies developed for Medicare Advantage in the Pioneer Accountable Care Organization program, which preserves the broad patient choice that is an important feature of traditional Medicare.