5.23.2008

Insurers to Pay to Keep Patients Healthy

Incentives matter.

That is at least part of the reasoning behind a new approach to healthcare reimbursements being tried in southeastern Pennsylvania.

The
Philadelphia Inquirer reports the region’s largest health insurers will start paying more than 150 family doctors and other caregivers to more closely track their patients’ care and conditions.

The story, written by Josh Goldstein, says the effort “seeks to make caregivers more accessible to their patients through e-mail and phone calls and to educate them to take better care of themselves.”

"The first thing we hope to accomplish is to increase the use of evidence-based medicine and improve the quality of care," said Richard Snyder, senior vice president for health services at Independence Blue Cross. "And by keeping control of chronic illnesses that we know over time will deteriorate, we hope we will decrease costs."

The story notes that some experts are skeptical the effort will save any money.

Regardless of that, for me the most interesting part of the article is this statement:

Instead of the traditional way - paying by the procedure - the program will reward caregivers for how well they dispense proven treatments and keep patients healthy.

I have written previously about how insurers are ending payments for certain treatments necessitated by medical errors. That gives healthcare providers an incentive to avoid those errors.

If that is the stick approach, this one is the carrot. Author Mark Graham Brown, who has written several books about metrics, including Beyond the Balanced Scorecard: Improving Business Intelligence with Analytics, taught me a long time ago that incentives should reward outcomes, not activity.

Providing incentives to keep people healthy is definitely the way to go.

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