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Michigan's Physician Group Incentive Program offers a regional model for incremental 'fee for value' payment reform
David A Share1, Margaret H Mason
1Blue Cross Blue Shield of Michigan, Detroit, USA. dshare@bcbsm.com
Health Affairs (Project Hope)
|September 6, 2012
Summary
Blue Cross Blue Shield of Michigan
Area of Science:
- Health Services Research
- Healthcare Policy
- Value-Based Care Models
Background:
- Traditional fee-for-service models can incentivize volume over value.
- Need for innovative payment models to improve healthcare quality and efficiency.
- Patient-centered medical homes (PCMH) show promise in coordinating care.
Purpose of the Study:
- To evaluate an innovative "fee for value" physician incentive program.
- To assess the impact of the Physician Group Incentive Program (PGIP) on quality, utilization, and cost.
- To determine the financial impact of PCMH capabilities on provider reimbursement and healthcare spending.
Main Methods:
- Implementation of a "fee for value" program rewarding quality and utilization measures.
- Incentivizing adoption of patient-centered medical home capabilities.
- Analyzing reimbursement changes and estimated medical cost savings.
Main Results:
- Potential for 40% or more increase in reimbursement for high-performing PCMHs.
- Estimated $155 million in lower medical costs for BCBS Michigan members in program year 2011.
- Shift towards rewarding system-based care over individual physician services.
Conclusions:
- The "fee for value" physician incentive program successfully incentivizes high-quality, efficient care.
- Patient-centered medical home capabilities are associated with significant cost savings.
- Future reimbursement strategies will prioritize value-based, system-wide care delivery.
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