For years, health insurers have been touting their efforts to change the health-care delivery system to meet the goal of providing better quality care at a lower price.
But lowering costs has proved elusive. Blue Cross Blue Shield’s Blue Distinction Total Care, a value-based care program begun in 2015 that covers more than 19 million Blue Cross Blue Shield members in 42 states and the District of Columbia, kept health cost increases down to about 5 percent from 2015 to 2016.
While that is below the national health-care cost increase of 6.2 percent during that period, it still is above inflation.
The program has demonstrated reduced emergency room visits and increased adherence to screenings, immunizations and other recommended care, Kari Hedges, senior vice president of commercial markets for the Blue Cross Blue Shield Association, told me.
“It’s a start in the direction of trying to move the cost trend in health care,” she said.
“Blues payers, national payers, and independent payers are trying a whole range of different approaches and innovations to try and lower the cost of care,” Niall Brennan, president and executive director of the Health Care Cost Institute (HCCI), told me. HCCI conducts independent research on health-care spending using a database for about 40 million people in employer-sponsored plans managed by Aetna Inc., Humana Inc., Kaiser Permanente, and UnitedHealth Group Inc.
Nevertheless, “Spending is accelerating, now slowing down,” Brennan said.
Brennan told me he’s surprised at “how relatively passive employers have been about rising health-care costs.” He thinks it’s reflective of a competitive job market, which continues to hold health-care benefits as a very important benefit for workers.
But programs that emphasize value instead of the traditional fee-for-service payment model that health-care analysts believe rewards health-care providers for performing a higher volume of services improve quality, Niteesh Choudhry, executive director of health-care delivery at Brigham and Women’s Hospital in Boston and a professor of medicine at Harvard Medical School, told me. Choudhry has co-authored a number of papers on value-based insurance designs.
One example: Medication adherence is often better with value-based insurance because the plans cover drugs needed by patients with lower out-of-pocket costs, Choudhry’s studies have found.
Taking steps that achieve improvements in patients’ health should mean they will have fewer emergency room visits and hospitalizations, Choudhry said. “But whether or not the reduction in those medical events is large enough to actually save the system money is not clear.”
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