CHCS - Center for Health Care Strategies

Improving the quality and cost-effectiveness of publicly financed health care

The Business Case for Quality in Medicaid – Still Searching for the “Slam Dunk”

Type:
Policy & Issue Briefs
Author:
Allison Hamblin and Stephen A. Somers
Published:
May 2013
Funder:
Robert Wood Johnson Foundation and The Commonwealth Fund

The Business Case for Quality: Phase II (BCQ II) was the second in a two-part project by CHCS to assess whether interventions targeting Medicaid populations could demonstrate both improved quality and cost-savings. The rigorous demonstration and evaluation was conducted to determine whether investments in quality are financially sustainable across all levels of the health care system.

BCQ II pilot projects, undertaken by three competitively selected grantees from 2008-2011, focused on improving care and reducing costs related to high-risk childhood asthma. By design, the bar was set high for the demonstration and evaluation. To achieve a return on investment (ROI) for improved quality of care, BCQII grantees had to not only improve quality of care, but do so in such a way that savings from quality improvements exceeded intervention costs relative to a statistically equivalent comparison group. Although results did not achieve an ROI, all three projects demonstrated improved quality. Two of the grantees are sustaining their initiatives given their commitment to high-quality patient care and the belief that the models will eventually be financially sustainable.

This policy brief summarizes BCQ II study findings and outlines lessons for designing Medicaid quality improvement efforts. The reality check of BCQ II is particularly relevant in the current environment where rapid proof of cost savings is often an expectation of Medicaid and other quality initiatives. This study offers key lessons for Medicaid stakeholders to consider in their efforts to maximize the likelihood of achieving desired cost-savings through payment and delivery system reforms.

 

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