• Reading list

    Lessons From Massachusetts: Cost Remains a Hurdle for Those With Public Insurance, by Bridget M. Kuehn (The Journal of the Medical Association)

    There Is More to Life Than Death, by Pamela Hartzband and Jerome Groopman (The New England Journal of Medicine)

    Spending Differences Associated With the Medicare Physician Group Practice Demonstration, by Carrie H. Colla, David E. Wennberg, Ellen Meara, Jonathan S. Skinner, Daniel Gottlieb, Valerie A. Lewis, Christopher M. Snyder and Elliott S. Fisher (The Journal of the Medical Association)

    Context.  The Centers for Medicare & Medicaid Services (CMS) recently launched accountable care organization (ACO) programs designed to improve quality and slow cost growth. The ACOs resemble an earlier pilot, the Medicare Physician Group Practice Demonstration (PGPD), in which participating physician groups received bonus payments if they achieved lower cost growth than local controls and met quality targets. Although evidence indicates the PGPD improved quality, uncertainty remains about its effect on costs.

    Objective.  To estimate cost savings associated with the PGPD overall and for beneficiaries dually eligible for Medicare and Medicaid.

    Design.  Quasi-experimental analyses comparing preintervention (2001-2004) and postintervention (2005-2009) trends in spending of PGPD participants to local control groups. We compared estimates using several alternative approaches to adjust for case mix.

    Setting.  Ten physician groups from across the United States.

    Patients and Participants.  The intervention group was composed of fee-for-service Medicare beneficiaries (n = 990 177) receiving care primarily from the physicians in the participating medical groups. Controls were Medicare beneficiaries (n = 7 514 453) from the same regions who received care largely from non-PGPD physicians. Overall, 15% of beneficiaries were dually eligible for Medicare and Medicaid.

    Main Outcome Measure.  Annual spending per Medicare fee-for-service beneficiary.

    Results.  Annual savings per beneficiary were modest overall (adjusted mean $114, 95% CI, $12-$216). Annual savings were significant in dually eligible beneficiaries (adjusted mean $532, 95% CI, $277-$786), but were not significant among nondually eligible beneficiaries (adjusted mean $59, 95% CI, $166 in savings to $47 in additional spending). The adjusted mean spending reductions were concentrated in acute care (overall, $118, 95% CI, $65-$170; dually eligible: $381, 95% CI, $247-$515; nondually eligible: $85, 95% CI, $32-$138). There was significant variation in savings across practice groups, ranging from an overall mean per-capita annual saving of $866 (95% CI, $815-$918) to an increase in expenditures of $749 (95% CI, $698-$799) . Thirty-day medical readmissions decreased overall (−0.67%, 95% CI, −1.11% to −0.23%) and in the dually eligible (−1.07%, 95% CI, −1.73% to −0.41%), while surgical readmissions decreased only for the dually eligible (−2.21%, 95% CI, −3.07% to −1.34%). Estimates were sensitive to the risk-adjustment method.

    Conclusions.  Substantial PGPD savings achieved by some participating institutions were offset by a lack of saving at other participating institutions. Most of the savings were concentrated among dually eligible beneficiaries.


    • PGP demo and savings: a common problem. care coordination activities are costly. they can avert hospital use among high risk groups – and compared to regular Medicare beneficiaries, dual eligibles are more likely to be admitted to the hospital and they are admitted more often (i.e. greater % using hospital, greater number of claims per user as well). your garden variety senior does not actually go to the hospital quite that much. inpatient (and possible SNF use and some outpatient) is the main domain where you see savings.