IMPAQ International and its subcontractor designed and conducted an evaluation of the Acute Care Episode (ACE) Demonstration Project that examined health delivery factors that encourage improved quality in patient care, including provision of incentives for improving the quality and safety of care and achieving the efficient allocation of resources. The three-year Demonstration took place in five sites--(11 hospitals in four states, Texas, Oklahoma New Mexico and Colorado).
The ACE Demonstration uses a global payment for a single episode of care as an alternative approach to payment for service delivery under traditional Medicare fee-for-service (FFS). For selected procedures (cardiothoracic and orthopedic surgeries) all the related physician and facility services are bundled into an episode of care and paid for in a single payment, with providers determining how to use this payment for the selected MS-DRGS. Among the research questions examined were the effects of the demonstration on costs, quality of care, and volume of services delivered. IMPAQ used claims files, MedPAR, and a wide range of administrative data to examine issues of Medicare costs and savings, due to the demonstration. IMPAQ collected selected primary data via key informant interviews and focus groups at the ACE Demonstration sites which enhanced the quantitative data analysis.