“The growth is outstripping every single measure of society’s ability to keep up,” said Glen Shor, executive director of the Commonwealth Health Insurance Connector, which runs the insurance exchange.
Having committed to health care for almost everyone, Shor said, Massachusetts does not have the same “safety valve” as other states, which are carving services and sometimes people from public health and insurance programs. “As a result, we have to, more than anywhere else, stare squarely at cost containment.”
In this climate, the private health-care marketplace already is taking steps away from fee-for-service, the method by which doctors, hospitals and others who treat patients are paid for each service they provide. The rationale is that such a system rewards more care rather than coordinated treatment and upfront care that can lessen the need for more expensive services later on.
The biggest move is being made by Blue Cross Blue Shield of Massachusetts, the commonwealth’s largest insurer. In 2009 it began a new payment system called Alternative Quality Contracts with some of the doctors and hospitals in its network.
The arrangement is a version of the accountable care organizations that the federal government also is trying to encourage in Medicare. They pay teams of doctors or hospitals a lump sum or what is called a “global budget” for the patients assigned to them. If a team can provide care for less, it keeps some of the savings, assuming it also meets enough of 64 measures of quality that Blue Cross has defined. Today, about one-third of the primary care doctors in Blue Cross’s network are taking part. A half-million HMO patients have been put in them — but not told by the insurer.
The arrangement is voluntary, but Andrew Dreyfus, Blue Cross’s president and chief executive, said that if doctors and others stay with the old fee-for-service model, “we can no longer pay the kind of price increases we have . . . in the past.”
Some doctors are embracing the new way of working. David C. Pickul is the medical director of the physicians group affiliated with Lowell General Hospital, in an economically bruised community about 30 miles northwest of Boston. The group is in the third year of a five-year “alternative quality” contract with Blue Cross involving a hub of 70 primary care doctors and a looser group of 200 specialists who are responsible for 20,000 HMO patients. The team now has a financial incentive, Pickul said, to track down patients when it is time for their mammograms or for eye exams for those with diabetes. Under Blue Cross’s quality rating, Lowell has soared the past two years.
Blue Cross is not alone. At Partners HealthCare, the famous Boston-based medical system that dominates health care here, Massachusetts General Hospital has been conducting a Medicare experiment in which nurses are assigned to coordinate care for about 2,500 older patients with multiple ailments. The experiment, which began five years ago, so far has reduced hospital re-admissions by one-fifth and cut medical spending by 7 percent.
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