Rewarding providers for high-quality care isn’t simple. Health care providers aren’t viewed as service providers because health care is more than a business transaction, and traditionally, 100% of the risk has been on purchasers. This means that employers, as purchasers, have paid for waste and mistakes, even when the health care provider is at fault. This long-established history makes payment reform complicated but necessary.
Incentivizing Quality Care
Achieving payment reform by creating the right incentives for care delivery is the foundation of The Alliance.
We’ve used our strength in numbers to pursue unique contract provisions that protect our members and their employees from unexpected charges.
We’re building on that foundation to include a focus on cost and quality transparency (our first core driver) to continue the payment evolution.
Payment Reform In Action
Now, we are implementing contracts that use Medicare-based pricing. Medicare, the largest purchaser of health care in the US, has done the work to establish base rates for various services and adjust them by provider to factor in geography, patient mix and quality metrics. Medicare-based pricing gives us the benchmark needed to pay a fair price for services, rather than focusing on a savings of total charges; you can’t change what you can’t see.
Paying providers also enables employers to use plan design (our next core driver) to incentivize employees to use lower-cost, higher-quality providers.
What Can Employers Do?
Employers that join purchasing cooperatives can use their collective bargaining power to influence the change in health care that employers want.
The Alliance’s solutions, like bundled payments and Medicare-based pricing, are customizable to each of our members’ circumstances and their appetite for achieving cost-savings.
To learn more about how The Alliance uses Payment Reform to cut costs and improve health care, contact us.
The Real Cost of Care
These efforts are moving us away from the fee-for-service model toward Total Cost of Care (TCOC) contracting. With TCOC, 100% of the care provided to patients is considered when analyzing reimbursements. This new direction helps identify patterns of overuse and inefficiencies in the health care system that remain hidden in a fee-for-service model. It also moves the risk traditionally born by employers for inefficient care and medical errors to the health systems.
We aim to identify cost-saving opportunities so we can reward provider partners that deliver the most cost-effective care to our employees and their families – the way health care should work.
