AQC Improves Affordability While Redefining Provider Experience, Care Delivery

Our Alternative Quality Contract (AQC) payment model continues to have a significant impact on efforts to increase both the quality and affordability of health care in Massachusetts. A recent analysis by BCBSMA of year three of our Alternative Quality Contract (AQC) payment model indicates that we are on track to reach our goal of reducing annual health care cost growth trends by half over five years.

Moreover, we have consistently heard from many members of the health care community that the AQC's aligned quality and efficiency incentives create an environment that fosters more communication, coordination, and integration between primary care providers and specialists, and between physician groups and participating hospitals. The new environment created by the collaborative payment model seems to be increasing innovation and changing the way providers deliver care.


Our preliminary analysis shows that AQC groups either maintained or improved their performance on patient experience and outcome measures.


Our analysis shows the AQC is also significantly slowing the rate of increase in spending, compared to groups that do not participate in the AQC. This is consistent with results that an independent analysis of the AQC by Harvard researchers found in 2012. That study revealed that participation in the contract over two years led to savings of 1.9 percent in year one and 3.3 percent in year two compared to spending in non-participating groups. Savings were substantially larger in the groups that had no experience with risk-based contracts—6.3 percent in year one and 9.9 percent in year two.

In 2011, we found that AQC groups' savings were generated in two key areas:

Provider Experience

Perhaps most notably, anecdotal evidence shows that the global budget model facilitates sweeping changes in the culture of most groups, including changes in roles and responsibilities. According to interviews of physician leaders, primary care providers, and specialists at all types of AQC groups, large and small, physicians are now working in teams with non-physicians (pharmacists, case managers, nurse practitioners, and diabetes educators, for example) who take on increased responsibility for patient contact and clinical decision-making.

Among the most common examples of the types of sustainable changes in the way groups and individuals practice that interviewees cited were these:

You can read about specific ways groups are innovating on our AQC website.

Looking Forward

We look forward to continuing to innovate with our provider organization partners to achieve a high-performance health care system with a sustainable rate of spending growth. At the same time, we recognize that the AQC is only one important part of our broader strategy to make quality health care more affordable for members, employers, and the broader community. Other key components are consumer-driven health insurance plans that engage members in choosing low-cost, high-quality providers and continued emphasis ways that we can improve the health and wellness of our members.