Care coordination demonstration achieves big government savings for dual eligibles: report

One of the first care coordination demonstration projects for Medicare beneficiaries achieved significant provider savings for dually eligible Medicare and Medicaid beneficiaries, a new analysis found.

The Physician Group Practice Demonstration, which was structured similar to an accountable care organization, reduced federal spending per Medicare beneficiary by $114, and an average of $532 per beneficiary among dual eligibles, a report on the demonstration concluded.

Dually eligible beneficiaries are people who are eligible for both Medicare and Medicaid. Many live in nursing homes and often require the most extensive care.

The demonstration project, which involved 5,000 physicians and 220,000 Medicare patients, awarded bonus payments to participating physician groups that met quality targets by coordinating care more efficiently, Kaiser Health News reported. Researchers from the Dartmouth Institute for Health Policy and Clinical Practice said the biggest reductions in federal spending were achieved through the reduction of hospitalizations.

However, lead author Carrie H. Colla, Ph.D., urged caution.

“As healthcare delivery systems move from fee-for-service models to accountable care models, patients on Medicare and Medicaid might be difficult to manage and might lead providers to avoid these groups,” she noted.

The report was published Wednesday in the Journal of the American Medical Association.