The government has taken an active role in shaping the way that healthcare will be provided in the future. The historic first step taken by Congress was to pass the controversial Patient Protection and Affordable Care Act (“ACA”), signed into law by President Obama in 2010. Due to constitutionality and presidential election issues, the future of ACA is at this moment a bit uncertain. However, currently it is the law and, regardless of ACA’s fate, Congress will continue to pass legislation that will force physicians to practice medicine in a manner that will focus on better quality of care while reducing costs.
After Congress passed this legislation, private insurers reacted, as expected. Within the past few weeks alone, Aetna launched a new program in Connecticut and New Jersey that will offer incentives to primary care doctors to oversee a patient’s overall health; Anthem Blue Cross and Blue Shield in Connecticut announced an innovative, primary care program that will allegedly dump an extra $1 billion or more into primary care; and UnitedHealth Group announced that it intends to replace its current fee-for-service payment model. UnitedHealth Group, the nation’s largest health insurer, intends to compensate hospitals and physicians for reaching certain quality goals. Currently, only 1%-2% of UnitedHealth Group’s 26 million commercially insured members are covered by its value-based payment contracts. UnitedHealth Group plans to change this statistic at a staggering rate.
By the year 2015, UnitedHealth Group intends to apply value-based payment contracts to up to 50%-70% of its commercially insured members. It plans to use several approaches for these types of contracts, including compensating providers in part through a bonus mechanism. If physicians meet certain quality metrics, they are compensated. If they don’t meet those metrics, pay increases could be withheld, according to the proposed plans. Eventually, this contract model will include most high-volume hospitals and medical groups. Hospitals will be measured by their readmission rates, mortality rates for certain conditions, hospital-acquired infection rates, and patient satisfaction; physician measures may include inpatient admissions, emergency department visits, and preventive screenings.
By making these changes in payment methodologies, the private health insurers are fundamentally changing their relationship with healthcare providers. Essentially, they will be increasing their financial support for those providers who help manage their patients’ overall health, eliminate duplicative services, and boost preventative efforts. The insurers’ ultimate goal in adopting these incentive programs is to advance the quality of healthcare, lower costs, improve coordination of care, and promote a more accessible and efficient experience for patients. The only way these goals can be achieved is if people are kept out of hospitals and physicians get more involved in patient care.
While these changes sound great in theory, meaningful improvement in the quality of care provided continues to remain on the shoulders of patients, who need to be active agents in their own healthcare. Patients will need to be rewarded for healthy behavior (or penalized for unhealthy behavior). The truth remains that quality healthcare is limited by the choices patients make when they walk out of a physician’s office.