Friday, December 10, 2010

BID doctors and BCBS go global

This story by Martha Bebinger at WBUR relates the fact that our physician group has joined with Blue Cross Blue Shield of Massachusetts in a new form of payment contract. Instead of being based on a fee-for-service rate structure, it is based on an annual average budget per patient, with bonuses offered for specific quality metrics and specific patient satisfaction scores.

As noted by BCBS CEO Andrew Dreyfus in the video below, BIDPO is the largest physician organization in the state to sign such a contract. Its membership includes all of the faculty at BIDMC, but also hundreds of primary care doctors and specialists in several community hospitals, private practice, and community health centers. Getting this variety of doctors to reach a consensus on the desirability of such a contract took education, time, and patience on the part of the BIDPO leaders, and particularly Dr. Stuart Rosenberg, the group's CEO. Stuart strongly felt that the BIDPO doctors should take the lead in delivering care based on a strong foundation of primary care, local delivery of service, and controlling the growth in costs.

One of the impacts of this kind of contract will likely be a reduction in certain services provided by BIDMC, either eliminating them altogether or delivering them at lower cost sites in the community. This makes sense from a societal point of view, and we welcome that result. Our business plan is not based on carrying out more and more procedures per patient: It is to become the destination of choice for patients who truly need tertiary care, but who want it delivered in a safe, high quality, and efficient environment -- a place that can substantiate its progress on those fronts by publication of clinical outcomes and other metrics for all to see (as below) -- and a place that closely coordinates care with our clinical partners in the community.

If you cannot see the video, click here.

8 comments:

jonmcrawford said...

Congratulations, this is exactly the kind of thing needed to help change our current structure! I'm curious if these BCBS patients are now locked-in to these physicians, as I've seen issues with physicians showing that the MCR companies were calculating didn't apply since they didn't see so many of the patients listed as 'assigned' to them? (In this scenario, the insurance companies don't restrict access to that particular physician)

Barry Carol said...

Wow! Congratulations to both BIDMC and to BCBS for your leadership and your willingness to take some risks on a new payment model. I was wondering if you could give us a sense for how your revenue expectations under this approach, assuming no bonus compensation, compares with what your revenue would have been under the traditional fee for service model and how big is the maximum potential bonus if you score well on all of the quality metrics. Also, how would the increase in the base payment rate be determined for future years?

Paul Levy said...

Barry, to be clear, this was a contract with the physician's group, not the hospital. We are on different contract renewal schedules with BCBS. The leadership here was displayed by Dr. Rosenberg and his team, plus the MDs in the contracting group.

Barry Carol said...

Paul – Even though the hospital is not involved, it’s still very good news, I think, and a significant step forward in payment reform. Doctors will now have an incentive to ensure that their patients receive imaging, labs and hospital based procedures from the most cost-effective high quality facility. In the past, doctors generally did not consider it part of their job to know or care about costs – either the insurer’s or the patient’s share. Now they will.

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Paul Levy said...

I totally agree.

Peter P Patterson MD MBA said...

Yes! Great beginning of a new experiment in healthcare delivery.
It strikes me as an example of the kind of systemic alterations that must accompany the operations/continuous improvements provided by Lean, for example.
This underlines the point that (systems thinker/researcher) Dr. Russell Ackoff was making in a video posted recently on Mark Graban’s Lean Blog.
It will be exciting to see how this experiment in global reimbursement persists during anticipated attacks by the plaintiff bar, the SEIU and others.
May the Force (for the good) Be With You.
/Dr. Pete

jemimah said...

Isn't it shameful that the insurance companies have made their billing so inscrutable that it's impossible for physicians to know what they "charge" for services? Though they are apparently willing participants, I don't think they need to be given a pat on the back for making some effort to clean up after themselves (and you can bet they're not going to suffer from this tack, either) and I thank and congratulate BIDPO for making this effort.

Anonymous said...

This is great! Based on the research I have done, different methods of payment reform work for each facility. How is BIDPO planning on tracking cost savings?