Corporate Compliance

Patient advocacy organizations: Gainsharing may diminish quality of care

Compliance Monitor, October 12, 2005

Thirteen patient advocacy organizations have released a statement opposing gainsharing on grounds that the cost-saving practice could undermine quality of care.

"Since the latest technology may also be the most expensive, patients may find they have limited options when trying to choose, for example, a new prosthetic most suitable to their needs," explained Andrew Imparato, president & CEO of the American Association of People with Disabilities.

Hospitals enter into gainsharing agreements with physician groups to reward physicians for taking cost-saving measures. For example, a hospital may suggest that a group of physicians agree to standardize materials or wait until disposable supplies are needed before opening them. As part of the agreement, the hospital shares any cost savings with the physicians.

Historically, the OIG has frowned on gainsharing arrangements, citing the possibility that such agreements would affect patient care. However, the OIG has come out with six advisory opinions since February allowing gainsharing in special circumstances.

Included among the thirteen organizations opposing gainsharing are the American Association of People with Disabilities, the National Mental Health Association, the Parkinson's Action Network, and the Society for Women's Health Research.

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