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Reducing health care spending and improving population health needs a comprehensive approach to replace the current fragmented silo-based approaches.
Thoughtful program designs with financial incentives and clear metrics have demonstrated that health care can be delivered at lower cost with similar or better outcomes than currently. Yet significant obstacles remain: Underinvestment in primary care and inconsistent quality continue to produce poor patient outcomes, escalating costs, and inequities across communities. While successful implementation of population-driven reform models relies on stakeholders including providers and state and federal governments, the private insurance market is a key influencer because of its role in private and public insurance markets and in setting standards of care that influence clinical practice.
We recommend continuing to pursue population health investment in prevention and expanding funding through two approaches that strengthen the recently implemented Centers for Medicare and Medicaid Services’ (CMS’s) Achieving Healthcare Efficiency through Accountable Design (AHEAD) model with public and private support. First, federal funding in primary care needs to be reallocated more to prevention from chronic care to enable goals for primary care investment targets. And second, state-level incentives need to be established to encourage private insurers to invest more in primary care.
Limitations Of Current Models
Achieving meaningful participation in whole-system change can be a challenge. For example, programs that integrate global budgets can put high-need hospitals at risk if the global budget is set too low. Risks and costs in communities can fluctuate due to unexpected changes such as an infectious disease outbreak or costly mental health epidemics, including dramatic increases in substance use disorders seen in recent years. While providers can financially benefit from outstanding care performance in a two-sided risk construct, facilities operating on slim margins can struggle to remain solvent when faced with the consequences of downside risk for not achieving performance targets that may not be entirely within their control.