Dissertation: Peer Participation, Spillover Effects, and Evaluation of the Medicare Shared Savings Program


In the transition to value-based care, several alternative payment models (APM) have been developed to provide financial incentives for providers to deliver coordinated, high-quality care at lower costs. The Medicare Shared Savings Program (MSSP) is by far the largest voluntary APM in Medicare and continues to play a significant role in moving away from traditional fee-for-service incentives. However, evaluating the causal effect of the MSSP is challenging in the presence of practice interactions. Practices may be more likely to participate and perform well in the MSSP when their peer practices, with whom they share a lot of patients, engage in similar efforts. Practice interactions also likely provide channels for the effects of MSSP to extend to non-MSSP beneficiaries. Little is known about the role of practice interactions in the participation and outcomes of the MSSP. The overall objective of this study is to leverage a network analytic approach based on patient sharing patterns across practices, combined with quasi-experimental designs, to examine the relationships between peer participation, spillover effects, and the performance of the MSSP. In Aim 1, I estimate the magnitude of peer effects in MSSP participation. In Aim 2, I examine whether peer participation modifies the effect of ACO on beneficiary-level outcomes. In Aim 3, I leverage patient geographic migration to estimate the effect of market-level MSSP penetration on non-MSSP beneficiaries’ outcomes. Results from this study show that at the practice level, more peers participating in the MSSP increase the probability of an index practice participating in the program. At the beneficiary level, the effect of ACO on cost savings is more pronounced for beneficiaries attributed to the primary care practices with higher peer ACO participation rates. At the market level, we find evidence of spillover effects on outpatient service utilization, and the direction of spillover effects depends on outpatient care settings. These findings suggest peer effects are an important mechanism aligning voluntary participation across practices and can be better leveraged to achieve cost savings and better patient outcomes under the MSSP. The evidence of spillover effects suggests that the MSSP-induced change in outpatient care patterns has extended to non-MSSP beneficiaries.

Yucheng Hou
Yucheng Hou
Assistant Professor in Health Economics

Yucheng Hou is an Assistant Professor at UTHealth Houston School of Public Health. As a health economist and health service researcher, Yucheng conducts research in the areas of payment and delivery system reform, care coordination, and policy evaluation.