Ten Michigan physician groups have been paid more than $1 million in the first installment of what could be as much as $12 million in incentives distributed this year under a recently launched pay-for-performance program by Blue Cross and Blue Shield of Michigan.
"It's a way to get paid to do the kind of chronic illness program design we need to do anyway," said Thomas Carli, M.D., medical director of the medical-management center and disease-management programs at the University of Michigan Health System. The 1,200-physician University of Michigan Health System Faculty Group Practice is one of the 10 groups participating in the incentive plan launched in January.
"We think this is giving us a preview of coming attractions because Medicare is going to do it too, as professional cost-of-living increases are going to be tied to these pay-for-performance plans," Carli said.
Thomas Simmer, M.D., senior vice president and chief medical officer of the Michigan Blues, announced last week that the payments made to the groups are incentives for them to meet improvement guidelines and goals. Three more quarterly payments are planned this year, Simmer said.
Bonus payments were made based on performance by the groups for adopting electronic medical-records systems, referring certain patients to care-management programs, identifying patients with a high risk of complications and applying evidence-based care programs to their care, and increasing use of generic drugs.
The program targets four chronic conditions: congestive heart failure, coronary heart disease, asthma and diabetes. Payments under the program were drawn against money "normally paid to physicians," not projected savings, according to the company.
Funds for the year will be allocated at one-half of 1% of claims volume, which should generate $10 million to $12 million in incentive payments for the groups this year, Simmer said. The Blues, the dominant payer in Michigan, cover more than $2 billion in physician claims payments each year.