Researchers at Yale University have outlined 10 new policy proposals they say could save billions in healthcare spending, targeting Medicare Advantage payments, site-neutral payments, drug costs, nursing home care and other areas.
Nine of the proposals carry annual savings estimates that together range from about $70 billion to $84 billion, while the remaining proposal is estimated to save households $44 to $58 a month.
The proposals are the latest additions to the Yale Health Care Affordability Lab’s 1% Steps project, which now includes 23 policies with estimated annual savings of about $450 billion, or roughly 8% of the $5.5 trillion the U.S. spends on healthcare annually, according to a Sept. 28 news release. The lab cautioned that the total is not a Congressional Budget Office-style estimate and does not account for potential interactions among the proposals.
“None of these ideas alone will fix the American health care system, but stacked together, these targeted reforms add up to substantial savings,” Zack Cooper, PhD, director of the lab, said in the release.
The 10 new proposals, according to the lab:
1. Allow the VA to bill Medicare Advantage plans for veterans enrolled in both, ending duplicate payments. Estimated savings: up to $23 billion a year.
2. Eliminate Medicare Advantage quality bonus payments tied to the star ratings system, which the lab said has not been shown to reflect higher-quality care. Estimated savings: $13 billion to $16 billion a year for Medicare.
3. Expand site-neutral payment rules so Medicare pays the same rate for the same service across ambulatory settings where it can safely be delivered outside a hospital. Estimated savings: $12 billion to $24 billion a year across Medicare and commercial plans.
4. Ban pay-for-delay agreements in which brand-name drugmakers incentivize generic manufacturers to keep cheaper drugs off the market. Estimated savings: $3 billion to $12 billion a year.
5. Merge the small-employer and individual insurance markets into a single risk pool. Estimated savings: $44 to $58 a month per household.
6. Allow long-term care insurance to pay family caregivers, which the lab said would increase uptake. Estimated savings: about $4 billion a year for Medicaid.
7. Expand mandatory bundled payments to hold hospitals accountable across an episode of care and shift patients to appropriate post-acute settings. Estimated savings: about $1.6 billion a year for Medicare.
8. Shift a portion of nursing home payments upfront rather than paying by the day. Estimated savings: about $1.5 billion a year for Medicaid.
9. Pay for perinatal care as a bundle, following a model Arkansas used to cut commercial costs nearly 4% per birth. Estimated savings: about $1.4 billion a year.
10. Allow pharmacies to vaccinate young children against flu. Estimated savings: up to $500 million a year at full vaccination.
Read more about the project here.
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