A 12-member New Jersey hospital consortium has achieved $113 million in savings through a "gainsharing" project that promoted hospital-physician collaboration.
The New Jersey Care Integration Consortium was a three-year pilot project launched in 2009 and led by the New Jersey Hospital Association. The program involved hospitals and their affiliated physicians making a voluntary commitment to establish financial incentive payments for physicians tied to relative performance (compared with peers) and improvement over time. The cost savings from the participating hospitals totaled nearly $113 million, out of which just under $19 million was distributed to physicians as incentive payments, according to a news release.
"Traditional Medicare protocols pay hospitals and physicians in different ways," Sean Hopkins, NJHA's senior vice president of health economics, said of the project. "Hospitals receive a set rate for each patient case, regardless of how long a patient is hospitalized, while physicians are paid 'a la carte' for each test, procedure or patient day in the hospital. The gainsharing philosophy makes hospitals and physicians partners in identifying more efficient ways to deliver quality healthcare."
Building off the success of the project, the NJHA has received federal approval for a second, larger demonstration project, which is ongoing under the Bundled Payments for Care Improvement initiative, according to the release.