Gainsharing: A Bigger Piece of the Pie


HM leaders are in a position to advocate for the potential cost savings and care efficiencies associated with gainsharing, according to a hospitalist who coauthored a study on the topic in this month’s Journal of Hospital Medicine. Gainsharing is a pay-for-performance model that tabulates the cost savings achieved via the adoption of best practices, then pays physicians bonuses with a portion of the savings.

The study found that in a three-year period ending June 2009, Beth Israel Medical Center in New York City reported a $25.1 million reduction in hospital costs, $16 million of which was attributed to physicians participating in the gainsharing program and $9.1 million from nonparticipating doctors (P<0.01) (DOI: 10.1002/jhm.788). In the same time frame, delinquent medical records dropped an average of 43% (P<0.0001).

Latha Sivaprasad, MD, FACP, FHM, medical director of quality management and patient safety and an internal-medicine attending at Beth Israel, says the data shows the viability of pay-for-performance programs.

“Gainsharing essentially aligns the incentives of physicians and hospitals to provide cost-efficient care without compromising patient safety,” says Dr. Sivaprasad. “Who better in the hospital to understand those principles than the hospitalist?”

Dr. Sivaprasad, who has been a hospitalist for eight years and is also an assistant professor at Albert Einstein College of Medicine in New York, says the majority of eligible physicians are now participating in Beth Israel’s gainsharing program, which started in 2006. She says that the validation by the Centers for Medicare & Medicaid Services (CMS)—evidenced by the Medicare demonstration project, which started in 2008—counters arguments about ethical concerns over pay for performance, as does the level of buy-in by physicians.

As it relates to HM groups, she adds, most already have some level of pay-for-performance budgeting in place.

“Pieces of it are there, even though they don’t call it gainsharing,” Dr. Sivaprasad says. “If hospitalists are incentivized for appropriate testing or streamlining throughput, pieces of this program are in place because efficient utilization of healthcare dollars is the heart of gainsharing. … Don’t excessively use precious resources you don’t need to in order to deliver quality medical care.”

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