Quality-based Payment Systems Vastly Expands
Written by Editor   
Friday, April 17, 2015 12:00 AM

The Massachusetts health care industry’s traditional system of paying doctors for every office visit, test, and procedure may be nearing its end.  The state’s largest health insurer, Blue Cross Blue Shield of Massachusetts, will vastly expand its system that pays doctors based on how well they care for patients — not just for the number they see and volume of services they provide. The move will extend the quality-based system to more than 1 million health plan members, making it the biggest initiative of its kind in the state and probably the country.  Performance-based systems are expected to be widely adopted as state and federal health care laws pressure providers to lower expenses.

Payment reform has gained steam nationally.  Two dozen health care providers and insurers launched a task force in January and vowed to commit 75 percent of their businesses to value-based contracts by the end of the decade.  And Medicare, the insurance program for seniors, said it will shift half of its payments to new models by 2018.  Thousands of Medicare patients are already part of alternative contracts in what are known as accountable care organizations, which receive incentives for keeping patients healthy.  Traditional fee-for-service medicine remains the norm, accounting for 66 percent of the Massachusetts market, according to state data. But health care providers say they expect those numbers to go down as more insurers adopt performance-based contracts.

The move by Blue Cross, which controls 40 percent of the state’s commercial insurance market, should hasten the decline of the way American doctors have been paid for decades, analysts said. The traditional model, known as fee-for-service, encourages unneeded care and drives up costs, without necessarily improving patient health, most industry specialists agree.

Blue Cross will essentially pay doctors a set amount to care for their patients but payments will ultimately be tied to how well doctors and hospitals score on a variety of quality measures.  They say they already coordinate care for many patients and moving to a single payment system that rewards quality of care will simplify their business model over time.

Source:  http://www.bostonglobe.com/business/2015/03/05/blue-cross-vastly-expands-quality-based-payment-systems/Hl2Dqj7aWCcp7LQpCWeljK/story.html?event=event25