Finding ways to cut rising healthcare costs has become a national priority, especially as an influx of newly insured members will be integrated into the industry in the coming years. It’s no surprise then that the Blue Cross Blue Shield Association (BCBSA) implemented the Alternative Quality Contract, a program that promotes quality care in order to cut costs in the healthcare industry.

In a recent study published in the journal of  Health Affairs by Chernew, Mechanic, Landon, and Safran, the BCBS of Massachusetts program found that the 4,800 doctors working with the alternative quality contract spent “3.3 percent less in 2010 (the second year of the program), compared to non-participating doctors, amounting to a $107 savings per patient. Some doctors spent almost 10 percent less than their counterparts operating under fee-for-service contracts,” reported The Boston Globe.

Physicians in the program are rewarded for cutting cost and reducing waste while providing quality care. The study showed that “the Blue Cross monitors quality indicators, such as whether doctors control patients’ blood pressure, provide regular check-ups to children, and prescribe appropriate and timely medications for depression. Compared to the control group, doctors with the alternative contract improved care for chronically ill adults and preventive care for both adults and children more quickly, the researchers found.”

The study suggests that global budgets with pay-for-performance can begin to control medical spending while improving quality of care. The Affordable Care Act uses a similar budget payment program for Medicare providers, and Massachusetts lawmakers are pushing the same strategy in legislation they plan to finalize this month.

“If these results and improvements continue, the health care system can be put on a sustainable path,” said Michael Chernew, the senior author of the study. Chernew noted that the findings about the quality of care in the AQC may not be conclusive because “quality measurement is an evolving field.” But BCBS is hopeful. Read More…

So while this type of innovative thinking is exciting news if it continues to produce cost-effective results, to what extent is it realistic? What other efforts are being made by private sectors to thwart rising health care costs?
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