Pay For Performance…
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Two folks I like and respect very much (Leanne Berge from Network Health and Paul Levy, the indefatigable blogger/CEO from Beth Israel Deaconess Medical Center) responded to my patient/consumer behavior blog by suggesting that I was underestimating the opportunity for plans and providers to work together to create financial incentives for providers to provide better care to plan members. Leanne spoke about incentives and reporting, tied to evidence-based medicine guidelines and quality and safety standards. Paul suggested a subscription payment (retainer?) (anything but a “capitation” payment, right?!) to primary care providers to provide more holistic care to patients/members with chronic conditions like diabetes.
My initial response to these ideas would be, “yes, but…” First of all, we do, in many cases, pay primary care providers more (usually as some kind of bonus) if they do a good job serving Harvard Pilgrim members with chronic conditions, like diabetes and asthma. We also provide reports on a variety of “best practice” standards to many of the physicians in our network - and in some, but not all - of these cases, the results are tied to more money. We also award quality grants - some $10 million in all over the past few years - to physician groups who are doing interesting things in improving quality, but need some funding to take their ideas to the next level.
Is this enough? No - probably not - but this is not something that has to be done incrementally, and I have no illusions about how hard it is, or would be, to put big money at risk for big results. Most clinicians are not that interested in having a significant portion of their income tied to performance, mostly because they have issues and concerns with the standards used for measuring performance, they wonder about their ability to control all of the issues around any one individual’s health care, and they don’t want to miss being rewarded because their patients might be non-compliant with a recommended treatment plan.
Paul and I actually discussed this in some detail as part of a Roundtable discussion in last month’s issue of Boston Magazine. Check it out! It’s riveting reading(!).
Do I believe that more can be done in this space? Yes. Will it happen quickly? Probably not - too many opponents (many of whom are in the provider community), too much attachment to fee for service (that is, paying for rendered services, but not necessarily paying for the right services) and too much debate about the practical benefits of moving aggressively in this direction.
But if Paul and his folks would like to do more of this, we’re up for talking about it - and I have his phone number!
That was a very interesting discussion in Boston Magazine. I wonder about the feasibility of the following: Insurers could make it clear to providers that they are getting a lot of pressure from their employer customers to measure performance. They could communicate a strong preference to have the doctors come up with performance metrics that made sense, were fair and could be measured. If they don’t, insurers will have no choice but to develop the metrics themselves.
With respect to the shortage of primary care doctors, I think this could be addressed, in part, by the spread of retail store based clinics staffed by NP’s and PA’s. Moreover, perhaps hospitals could buy up primary care practices, organize them into groups of two, four, six or eight doctors each, and spread them around to insure appropriate geographic coverage. Pay them a competitive salary, give them a reasonable patient load so they can spend adequate time with each patient, and accept current reimbursement rates. This probably means, the hospital would operate the primary care segment of its business at a loss deliberately. To make up the difference, insurers could increase reimbursement rates (both case rates and per diem) for inpatient stays and, perhaps, boost reimbursement rates for outpatient services as well. To save money, aggressively go after the huge amount of wasteful and futile treatment that occurs at the end of life by making sure everyone has a living will, DNR orders are honored, and sound medical practice is redefined to apply common sense depending on circumstances. If, at the end of the day, the number of inpatient hospital beds needs to shrink to reflect reduced demand, so be it.
My idea re: patient/consumer behavior is to shift the incentives more to the consumer. Just as you can get a car insurance discount for a good driving record, or a life insurance discount for optimal health criteria, why not provide a health insurance discount for people willing to take better care of themselves (or perhaps a tax incentive?)
A few simple annual measures could be verified in the doctor’s office: waist circumference, Chol & BP WNL (controlled by lifestyle or meds), perhaps resting heart rate or BF% (as a measure of routine exercise adherence), non-smoking lifestyle ETC. If a factor was uncontrollable d/t genetic factors, for example some types of hypercholesterolemia, a note from the physcian would drop that score from the total.
As a consumer, who chooses to take care of herself, I feel helpless as I watch healthcare rates escalate to a great degree because of others who choose not to take care of themselves. It is an unfair situation and I believe a financial incentive would drive people to change. I read recently about a company that gave financial rewards for weight loss and had great results when in the past other incentives did not work! They were self-insured and significantly lowered their costs. In one of your other topics you discussed a small percent of people with multiple conditions (diabetes and related) consuming a big percent of the healthcare dollar for treatment. Doesn’t PREVENTING these conditions in the first place make the most sense?
Great blog. Thank you.