The state’s largest commercial insurer announced Monday that it had signed agreements with Partners HealthCare, Steward Health Care, Lahey Health and Mount Auburn Hospital as well as its independent physician group to expand its budgeted reimbursement model to a wider range of patients.
Blue Cross Blue Shield of Massachusetts said the agreement — with three of the five biggest hospital systems in the state — will help control the health care spending of another 300,000 of its members. Blue Cross currently boasts 2 million Massachusetts members, although only 630,000 members were previously accessing care under a budget reimbursement model.
“The single most promising approach to improve patient care and lower costs is to change the way we pay for care — to realign financial incentives to reward the quality, outcome and efficiency of the care patients, our members, receive,” said Andrew Dreyfus, CEO of Blue Cross Blue Shield of Massachusetts, in remarks to the Health Policy Commission during the Commission’s Cost Trends Hearing on Monday.
Bringing more patients into budgeted payments has been a goal of the state’s Health Policy Commission. The state group, created in 2012 to grapple with Massachusetts rising health care costs, has believed the way to reign-in health care spending is by putting more people into budgeted health care contracts.
The deal would expand what is called an Alternative Quality Contract — in that providers must manage the care of a person on a budget so as to incentivize them to keep patients healthy. By so doing, a provider gets to share in the savings, or otherwise must share in the costs of going over budget.
That type of contract has largely been relegated to patients in HMO (health maintenance organization) insurance contracts, which says that patients have a primary care physician and must seek referrals to go to other specialists and doctors.
Physicians have long considered it easier to manage the care of a patient if there is one central person doing the managing, and if patients can only go to other doctors that the primary care physician allows.
But now, patients in PPO (preferred provider organization) insurance contracts will also be eligible to be cared for on a budget.
Though providers were hesitant to be held financially responsible for patients that weren’t required to have a primary care doctor, and who could go to any doctor they wanted, Dreyfus said that research showed that members with PPO insurance still were loyal to one primary care doctor, and largely still sought out referrals from those physicians.
Stuart Altman, chair of the Health Policy Commission, said the BCBS move is was a small part of a larger picture to control health care spending — one that will become increasingly difficult. He said Tufts Health Plan and Aetna are expected to follow BCBS’s lead in Massachusetts.
“We’re increasingly concerned that the good experiences we’ve been having over the last couple years may be coming to an end,” Altman said. “On the one hand, we’ll be facing more cost pressure than we have in the last two years. Particularly on the commercial side. On the positive side, we’re seeing progress.”
Date: October 6, 2015