Examining the effects of Global Budget Revenue Program on the Costs and Quality of Care Provided to Cancer Patients Undergoing Chemotherapy

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Project Summary/Abstract In 2014, the state of Maryland, under a federal waiver, enacted an all-payer Global Budget Revenue (GBR) model that prospectively set limits on hospital revenue. It also required the state to limit growth in per-capita spending and mandated reductions in preventable complications and readmissions. GBR implementation was associated with savings to the Medicare Trust Fund and considerations are now underway to expand the program to other regions. However, there is limited understanding of GBR’s impact on the delivery of cancer- related services. It is possible that while GBR may incentivize reduced healthcare expenditures and care improvements on average, it could be associated with unintended effects and poor performance for cancer patients by limiting access to effective cancer treatments. GBR may have deleterious effects on prevailing cancer care inequities by encouraging adverse patient selection towards racial minorities and patients with socioeconomic vulnerability due to concerns about higher spending and worse clinical outcomes. Current evaluations of the GBR program have not examined these impacts. We aim to address this evidence gap in this proposal. Our research is important because acute hospital care, the focus of GBR incentives, is a key driver of overall spending and regional variation in spending for patients with cancer. The objective of this proposal is to systematically examine, via a difference-in-differences design, the impact of the GBR model on spending, quality-of-care, and utilization among fee-for-service Medicare beneficiaries and nonelderly Medicaid and commercial insurance beneficiaries with cancer in Maryland compared with similar patients in control states. Our central hypothesis is that the financial incentives in GBR will lower spending, improve care quality, and facilitate a shift in the site of care for chemotherapy administration across our populations of interest. Additionally, we hypothesize that GBR implementation will lead to relatively worse clinical outcomes and relatively greater spending for historically marginalized patients. We will test our hypotheses and achieve our objectives with the following specific aims: Aim 1: Quantify the impact of GBR on risk-adjusted spending for beneficiaries undergoing chemotherapy. Aim 2: Assess the impact of GBR on the likelihood of chemotherapy receipt and on care quality for beneficiaries undergoing chemotherapy. Aim 3: Assess the impact of GBR on the type of chemotherapy (physician-administered vs. oral) and site of physician-administered chemotherapy (hospital outpatient department vs. physician office setting). Aim 4: Assess the differential effects of GBR implementation on care delivery for historically marginalized patients, based on area-level deprivation, race and ethnicity, and dual-eligible status, who are undergoing chemotherapy. Our findings will meaningfully advance our understanding of how to deliver efficient, high- quality cancer care to adult patients. It will also provide timely information to policy-makers that would guide updates to GBR and mitigate the risk of unintended consequences in future global budget initiatives.