January 27, 2009 —

Abstract: To succeed, health care reform must slow spending growth while improving quality. We propose a new approach to help achieve more integrated and efficient care by fostering local organizational accountability for quality and costs through performance measurement and "shared savings" payment reform.

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The approach is practical and feasible: it is voluntary for providers, builds on current referral patterns, requires no change in benefits or lock-in for beneficiaries, and offers the possibility of sustained provider incomes even as total costs are constrained. We simulate the potential expenditure impact and show that significant Medicare savings are possible.

Read the Health Affairs Web Exclusive, "Fostering Accountable Health Care: Moving Forward in Medicare" »