Report: Coordinated Care, Global Budgets Could Save California $110B

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Shifting further away from fee-for-service payments to coordinated care could reduce California's healthcare spending by $110 billion over 10 years, according to a study released by the University of California, Berkeley's School of Public Health.

University officials gathered CEOs of health insurance companies and medical provider organizations to examine the state's healthcare market over a year.

Even with California's high HMO enrollment rate of 44 percent — about double the national average — 78 percent of the state's healthcare costs amounting to $245 billion annually are paid as traditional fee-for-service arrangements.

Authors of the report recommended cutting that number to 50 percent by 2022, replacing it with global budgets and greater integrated care enrollments similar to the Oakland, Calif.-based Kaiser Permanente model.

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