I caught up with David Cordani, Cigna Corp.’s president and CEO, yesterday in Dallas, and took the opportunity to ask him whether he thought the controversial Affordable Care Act — Obamacare — would survive in its current form.
His answer? In the short term, he doesn’t know. In the long term, he hopes the health care reform law will evolve.
“Long before the health care law was signed, we believed as a company that health care needed to evolve and reform, and we were very active in Washington in a nonpartison way,” Cordani told me as we stood in Klyde Warren Park. “Once the law was passed, we’ve been very clear that the law needed to be evolved to be sustainable. The law expanded access to insurance, but to make it sustainable, we need expanded access to and improvements in clinical quality and improvements in affordability.”
The U.S. health care system remains largely a fee-for-service system, Cordani said. Physicians, hospitals, medical device manufacturers and pharmaceutical companies are paid based on a unit of service.
Here’s what needs to change, as Cordani sees it:
“The change that’s being discussed, and we believe has a lot of opportunity is, paying for value versus paying for volume,” he said. “That could happen through bundled payment, shared risk payment and rewards that are based on clinical transparency. The highest performing physicians, hospitals, device manufacturers and pharmaceutical manufacturers will be rewarded more, and lower performers will be rewarded less.”
That’s where accountable care organizations come in. Cigna has its version of ACOs, only it calls them collaborative accountable care arrangements. The company has just added a new one in North Texas. I’ll discuss that one in a blog tomorrow.
Date: Oct 17, 2013