Changes in health care spending and quality 4 years into global payment.

Background: Spending and quality under global budgets remain unknown beyond 2 years. We evaluated spending and quality measures during the first 4 years of the Blue Cross Blue Shield of Massachusetts Alternative Quality Contract (AQC).

Methods: We compared spending and quality among enrollees whose physician organizations entered the AQC from 2009 through 2012 with those among persons in control states.

The 'Alternative Quality Contract,' based on a global budget, lowered medical spending and improved quality.

Seven provider organizations in Massachusetts entered the Blue Cross Blue Shield Alternative Quality Contract in 2009, followed by four more organizations in 2010. This contract, based on a global budget and pay-for-performance for achieving certain quality benchmarks, places providers at risk for excessive spending and rewards them for quality, similar to the new Pioneer Accountable Care Organizations in Medicare. We analyzed changes in spending and quality associated with the Alternative Quality Contract and found that the rate of increase in spending slowed compared to control groups, more so in the second year than in the first.

Health care spending and quality in year 1 of the alternative quality contract.

Background: In 2009, Blue Cross Blue Shield of Massachusetts (BCBS) implemented a global payment system called the Alternative Quality Contract (AQC). Provider groups in the AQC system assume accountability for spending, similar to accountable care organizations that bear financial risk. Moreover, groups are eligible to receive bonuses for quality.