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Value-based care program in Maryland scores well on costs, but not quality

There was little evidence that the program made a dent in readmissions, observation stays, outpatient use or ER visits.

Jeff Lagasse, Associate Editor

The state of Maryland enacted a payment system four years ago giving most acute care hospitals an annual, all-payer global budget for inpatient, outpatient and emergency department services. And while the value-based care program made headway in controlling costs, it didn't appear to improve quality, according to a study in the Journal of the American Medical Association.

The results demonstrate that the shift to value-based care may take years to have a tangible impact on care quality.

[Also: Maryland's all-payer model achieves $429 million in hospital savings, study shows]

As part of the program, the state looks at all patients at a particular hospital in a year and gives the provider a fixed, capitated payment based on that number. Hospitals are responsible for any cost overruns under the arrangement, but can keep any revenue if there's a surplus. 

The goal is to achieve efficient treatment that avoids readmissions, a metric that can result in federal financial penalties if they're shown to be worse than those of competitors.

Yet the research, which examined the first two years of the program, found scant evidence that the program actually made a dent in readmissions. It also didn't bring down observation stays, outpatient use or ER visits.

A next phase of the model will address non hospital costs, as well as new incentives for physicians to support value-based care, and the researchers advise tracking the progress of the program to see if the expected improvements to clinical quality take shape over a longer period of time. 

The authors estimated it may take about 5 to 10 years for the program to make deep, lasting changes in that department.

Twitter: @JELagasse
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