Cost Containment and the Tale of Care Coordination

Authors
J. Michael McWilliams
Journal Article
December 2016

This resource explores why it’s not necessarily true that care coordination and cost savings go hand in hand — and the dangers of this common myth.

 

  • Care coordination is widely considered the leading strategy for achieving savings under new payment models such as the Medicare accountable care organization (ACO) and bundled-payment programs; however, studies of programs or practice models designed to enhance coordination and management of care for patients with multiple conditions and multiple providers have shown minimal, if any, consistent savings.
  • Although improving care coordination is a pathway to prevent certain types of medical errors and redundancies, coordination efforts often do not intersect with the most significant causes of wasteful care and drivers of cost.
  • The myth that care coordination is a reliable path to cost savings presents the following dangers: diminishing the intrinsic value of coordinated care, inhibiting the science of waste reduction, and perpetuating the possibly false notion that efficiency involves a trade-off between competition and coordination.
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Population Addressed
Adults Under 65 with Disabilities
People with Advanced Illness
Frail Older Adults
People with Multiple Chronic Conditions
People with Behavioral Health and Social Needs
Key Questions Answered
  • Does improving care coordination usually reduce costs?
  • What are the dangers of assuming cost savings will necessarily result from improved care coordination?
  • What are the true benefits of coordinated care, and how can we really reduce health care costs?
Level of Evidence
Expert Opinion
What does this mean?