Value Partnerships achieves $6.3 billion in cost avoidance

Over the past 20 years, Blue Cross Blue Shield of Michigan has worked diligently alongside 20,000 physicians, 40 physician organizations, and over 100 hospitals across the state to create a more efficient, affordable and high-performing health care system. This collective effort, known as Value Partnerships, has produced excellent results.

Through Value Partnerships, participants have successfully improved care quality, reduced complications and errors, and prevented unnecessary hospital stays and emergency department visits. As a result, we have avoided approximately $6.3 billion in health costs. This significant accomplishment is a result of collaborative work statewide to transform the health care delivery system and align payment with performance and outcomes.

“The Value Partnerships program has been transformative for the care here in Michigan and across the U.S. While the program's economic impact is shocking at first glance, it shouldn’t be surprising given the deep level of commitment by all stakeholders, including clinicians, health systems and payers. By working together to improve patient care, we have transformed what it means to put patients first in health care,” said Geoffrey Barnes, MD, MSc, program director of Michigan Anticoagulation Quality Improvement Initiative.

Here are some highlights of the cost avoidance between 2008 and 2023:

• Collaborative Quality Initiatives: CQIs have helped avoid $4.08 billion in costs due to prevented complications and improved outcomes. Today, there are 20 CQIs, covering a wide range of medical and surgical processes.
• Patient-Centered Medical Home Designation Program: This nation's largest health plan-led PCMH designation program has prevented an estimated $813.5 million in costs due to prevented ER visits and hospital stays.
• Provider Delivered Care Management: PDCM has avoided $1.25 billion in costs by preventing ER visits, hospital admissions and re-admissions, and focusing on providing care management services for patients with multiple health needs.
• Hospital Value-Based Contracting: Value-based payment contracts with hospitals statewide have avoided $160 million in costs due to more favorable care outcomes for patients.

These numbers reflect years of partnership between Blue Cross, physicians, physician organizations and hospitals statewide. Our Value Partnerships portfolio has significantly influenced health care affordability and quality, with $3.4 billion in avoided costs attributed to Blue Cross and $2.9 billion to Medicare, Medicaid, other private health plans and self-pay patients.

By working together, we can continue to make health care more affordable and accessible while still delivering high-quality care. Collaboration has been a key factor in achieving such high cost avoidance. In fact, as of 2024: 

• 73% of primary care physicians and 49% of specialists in the Blue Cross PPO are participating in PGIP
• 90% of eligible PGIP primary care physicians have been designated as a PCMH provider
• 100% of acute care hospitals in Michigan are participating in CQIs

“Through program participation, we have expanded clinical resources, integrated behavioral health in primary care, and anchored the partnership between our primary care physicians and their patients. The BCBSM Value Partnerships program invites you into the impossible, and together, we find a way to make it possible,” said Jenifer Hughes, president of Administrative Network and executive director of Oakland Southfield Physicians.

“Value Partnerships has created better care, better outcomes and a better patient experience statewide. By preventing billions in health costs due to these programs, we can confidently say our efforts working together have made a significant difference in the lives of Michigan residents”, states Thomas Leyden, Director of Value Partnerships at Blue Cross.

Learn more about Value Partnerships here.

Blue Cross Blue Shield of Michigan and Blue Care Network are nonprofit corporations and independent licensees of the Blue Cross and Blue Shield Association.