Skip to main content
Sister Publication Links
  • ESG: THE NEW IMPERATIVE
Subscribe
  • My Account
  • Login
  • Subscribe
  • News
    • Current News
    • COVID-19
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Transformation
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Digital Health
  • Insights
    • ACA 10 Years After
    • Best Practices
    • Special Reports
    • Innovations
  • Data/Lists
    • Rankings/Lists
    • Interactive Databases
    • Data Points
  • Op-Ed
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
  • Awards
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top 25 Innovators
    • Diversity in Healthcare
    • Women in Healthcare
    • - Luminaries
    • - Top 25 Diversity Leaders
    • - Leaders to Watch
    • - Luminaries
    • - Top 25 Women Leaders
    • - Women to Watch
  • Events
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Custom Media Event: ESG Summit
    • Transformation Summit
    • Women Leaders in Healthcare Conference
    • Social Determinants of Health Symposium
    • Leadership Symposium
    • Health Care Hall of Fame Gala
    • Top 25 Women Leaders Gala
    • Best Places to Work Awards Gala
    • Top 25 Diversity Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Supply Chain Revenue Cycle
    • - Hospital at Home
    • - Workplace of the Future
    • - Strategic Marketing
    • - Virtual Health
  • Listen
    • Podcast - Next Up
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
  • MORE +
    • Advertise
    • Media Kit
    • Newsletters
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Providers
March 26, 2013 01:00 AM

Value-based insurance plans gain momentum

Jonathan Block
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    The movement among employers to push insurers to adopt health plan benefit designs that improve medical outcomes without raising costs is slowly gathering steam, according to an employer coalition pushing payment reform.

    While only 11% of payments that commercial insurers made to in-network providers in 2012 were “value-oriented,” according to a survey from Catalyst for Payment Reform, that's more than halfway to its goal of 20%, which the group hopes to attain by 2020.

    The numbers suggest there is reason to believe the insurance industry and providers can achieve the coalition's goal, said Suzanne Delbanco, executive director of the not-for-profit coalition of employer groups, which issued its first-ever National Scorecard on Payment Reform.

    Value-based insurance plans come in many forms, from capitated payments to shared savings on the plan side to reformed copays and deductibles on the beneficiary side. The goal is to incentivize beneficiaries to purchase lower-cost goods and providers to forgo services that may be wasteful. Some large employers and insurers are turning to value-based plans as a way of holding down costs without jeopardizing overall health outcomes.

    The survey suggested insurers had made more headway with hospitals than other providers in moving toward value-based plan designs. Overall, 11% of hospital payments were value-oriented compared with 6% each for outpatient specialist and primary-care physician payments.

    The coalition compiled the scorecard based on data voluntarily submitted by 57 health plans representing 67% of the commercial market group. The survey was funded by the left-leaning Commonwealth Fund and the California HealthCare Foundation, a non-for-profit group dedicated to improving healthcare.

    The results showed that most of the value-oriented payments, 57%, were considered “at-risk” since providers could have been penalized financially if they failed to meet quality or outcome goals. These payments included bundled and capitated payments. The remaining 43% included fee-for-service with shared savings and fee-for service base payments with bonuses for performance.

    A report released in January by the Commonwealth Fund found that provider payment reforms are one of three key strategies that can stem the rising tide of U.S. healthcare costs.

    Many major insurers are getting into the habit of signing contracts with providers that include a value-based element to how payments are made, especially with the growth of accountable care organizations.

    Jill Hummel, vice president of payment innovation for WellPoint, said that 50% of the physicians under contract with the insurer are paid based on a pay-for-performance basis. Hummel and other industry leaders joined a panel discussion Tuesday on the scorecard in Washington.

    Payment reform, however, is not only a private-sector ambition. The CMS has many programs in the area, including the Pioneer ACO Program, bundled payments and the Medicare Shared Savings Program for ACOs. And during the past two years, Medicare spending per beneficiary has declined, said Dr. Richard Gilfillan, the director of CMS' Center for Medicare and Medicaid Innovation, who spoke at the forum.

    Also, more than 50,000 providers are or will be providing care to beneficiaries through one of the programs, 4 million beneficiaries are receiving care through an ACO and more than 1 million through a primary-care physician program. He added that in 2012, Medicare had 70,000 fewer hospital readmissions.

    In the past, many providers have resisted moving away from the fee-for-service system, but that culture has changed significantly, said Dr. Mark Smith, president and CEO of the California Healthcare Foundation. Most providers, Smith said, recognize the “inevitability of payment reform,” citing the work of the ABIM Foundation's Choosing Wisely campaign, which works with state medical societies to help providers recognize unnecessary medical tests and procedures.

    And there is also a role for health plan members, said Elizabeth Curran, head of national network strategy and program development at Aetna. Aetna for years has made prices of certain services available to patients in order to help them become better healthcare shoppers. That effort ultimately promotes price transparency, Curran said.

    With increased transparency, if employers find out that certain hospitals are charging more for certain procedures compared with others, those hospitals may get excluded from provider networks, Hummel said.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Dr. Alex Jahangir
    Q&A with Dr. Alex Jahangir of Vanderbilt Medical Center: 'It really was a big private-public partnership'
    rural-health2_i.png
    Readmissions and rural hospitals
    Sponsored Content
    Modern Healthcare A.M. Newsletter: Sign up to receive a comprehensive weekday morning newsletter designed for busy healthcare executives who need the latest and most important healthcare news and analysis.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • COVID-19
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Digital Health
    • Insights
      • ACA 10 Years After
      • Best Practices
      • Special Reports
      • Innovations
    • Data/Lists
      • Rankings/Lists
      • Interactive Databases
      • Data Points
    • Op-Ed
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Awards
      • Nominate/Eligibility
      • 100 Most Influential People
      • 50 Most Influential Clinical Executives
      • Best Places to Work in Healthcare
      • Excellence in Governance
      • Health Care Hall of Fame
      • Healthcare Marketing Impact Awards
      • Top 25 Emerging Leaders
      • Top 25 Innovators
      • Diversity in Healthcare
        • - Luminaries
        • - Top 25 Diversity Leaders
        • - Leaders to Watch
      • Women in Healthcare
        • - Luminaries
        • - Top 25 Women Leaders
        • - Women to Watch
    • Events
      • Conferences
        • Transformation Summit
        • Women Leaders in Healthcare Conference
        • Social Determinants of Health Symposium
        • Leadership Symposium
      • Galas
        • Health Care Hall of Fame Gala
        • Top 25 Women Leaders Gala
        • Best Places to Work Awards Gala
        • Top 25 Diversity Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Supply Chain Revenue Cycle
        • - Hospital at Home
        • - Workplace of the Future
        • - Strategic Marketing
        • - Virtual Health
      • Webinars
      • Custom Media Event: ESG Summit
    • Listen
      • Podcast - Next Up
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • MORE +
      • Advertise
      • Media Kit
      • Newsletters
      • Jobs
      • People on the Move
      • Reprints & Licensing