Scott MacStravic, Ph.D.
Now that the federal government has removed some of the stigma and restrictions associated with gainsharing, it has become a hot topic. CMS is employing a gainsharing approach of its own in at least one of its disease management demonstration projects with large physician groups and integrated health systems, offering these “partners” up to 80% of cost reductions they produce beyond a 2% minimum. [“Physician Group Practice Demonstration Bonus Methodology Specifications” Centers for Medicare & Medicaid Services Dec 20, 2004 (www.cms.hhs.gov)]
Most recently, it has offered hospitals and physicians the opportunity to share gains in cost reductions achieved through partnerships that reduce infections, standardize medical devices and supplies used in patient care. [D. Burda “The Gain Is Afoot” Modern Physician Oct 2006 p.9] Until recently, this had been explicitly prohibited by federal regulations, and now the federal government is sponsoring one of the largest gainsharing experiments yet.
But gainsharing is not without its continuing skeptics. The objection, much the same one that has been voiced relative to fee-for-service medicine, itself, involves the potential for physicians and hospitals to put their own interests ahead of those of their patients. Such “opportunism” is always present when the interests of two parties do not coincide, as is certainly the case with gainsharing based on reducing the costs of sickness care rendered to patients.
One explicit concern has been voiced with respect to the different surgical devices available for treating vaginal wall prolapse. The cheapest device can cost $2500 less than the most expensive, hence is a logical target for cost savings when gains can be shared. But some devices make OR, recovery and LOS times longer, so may not reduce the total costs of patient care at all. And some make restoration of normal function less sure in patients, so may be counter to patients’ best interests.
The executive director of the National Association for Continence voiced precisely these concerns in an article arguing that gainsharing based on reduced costs to payers can undermine the doctor-patient relationship, hence presumably, the hospital-patient relationship. She cited the risks that patients may be short-changed when providers can gain greater revenue at their expense. [N. Muller “No Gain in Gainsharing” Modern Physician Oct 2006 p. 10]
When gainsharing is based on cost savings in sickness care, this is a logical and perhaps inevitable concern. By contrast, when hospitals and physicians are engaged in proactive health care, it is neither inevitable nor necessarily a concern, and certainly not as great a one. In proactive health, cost savings are achieved by reducing the incidence and prevalence of sickness in the first place, and of the crises, complications and worsening of chronic sickness that has not been avoided.
Making sure that the costs of proactive health care is low enough to ensure cost savings to payers is not simply logical – it is essential to making such care a viable investment, for providers and payers. The costs of treating each patient should logically be adjusted, along with the methods used in managing each’s health or disease, in order to have the best chance of mutual benefit among payers, providers and patients.
The interests of patients, payers, and providers are in proactive health care, unlike reactive sickness care, entirely in alignment precisely when and because cost savings are achieved by enabling patients to become or remain healthier than they would otherwise. While the financial benefits accrue mainly to providers and payers under gainsharing arrangements that apply, patients gain better health and life quality, and may even gain financially, themselves, by saving out-of-pocket costs for sickness care, and even for tobacco, alcohol and drugs, for example.
There is no question but that any approach to reforming healthcare should consider the best interests of all parties and stakeholders involved, the chances of conflicts in these interests are far less in proactive health than in reactive sickness care. Moreover, the generosity of insurers and particularly employers is likely to be greater in proactive health, since such payers stand to have far greater financial gains to share.
