Insurance giant WellPoint will seek to tie half its commercial reimbursement to performance-based payouts by the end of the year, up from 30% last year, company CEO Joseph Swedish told industry professionals at the American College of Healthcare Executives.
The shift is one enabled by technology, Swedish said, which paired with innovation in the marketplace could bring about a revolution to address what he described as an unacceptable status quo. Household medical bills have climbed faster than wages as national health spending increases as a share of the U.S. economy, he said. “Revolutions happen because the status quo is unacceptable,” he noted.
Performance-based payouts to providers are projected to amount to $30 billion for WellPoint this year, he said, as the system expands on efforts such as a reference-based pricing initiative with the California Public Employees' Retirement System, which reduced spending by about $3.1 million, researchers reported last year in Health Affairs.