Cost And Quality Trends In Direct Contracting Arrangements
- 1 January 2002
- journal article
- research article
- Published by Health Affairs (Project Hope) in Health Affairs
- Vol. 21 (1), 89-102
- https://doi.org/10.1377/hlthaff.21.1.89
Abstract
This paper presents the first empirical analysis of a 1997 initiative of the Buyers Health Care Action Group (BHCAG) known as Choice Plus. This initiative entailed direct contracts with provider-controlled delivery systems; annual care system bidding; public reports of consumer satisfaction and quality; uniform benefits; and risk-adjusted payment. After case-mix adjustment, hospital costs decreased, ambulatory care costs rose modestly, and pharmacy costs increased substantially. Process-oriented quality indicators were stable or improved. The BHCAG employer-to-provider direct contracting and consumer choice model appeared to perform reasonably well in containing costs, without measurable adverse effects on quality.Keywords
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