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The nation's second-largest insurer, WellPoint Inc., will begin this summer to pay primary-care doctors extra in order to hopefully provide better treatment and cut more expensive treatment in the future.
WellPoint covers around 34 million Americans, whose primary-care physicians (PCPs) will be offered approximately a 10% fee increase for extra care, with incentives sometimes lifting the increase to 50%. WellPoint is looking to spend about $1 billion or more on this gamble in the hope that it will pay off in fewer emergency room visits and costly medical services. WellPoint now services about $100 billion in annual claims and estimates saving up to 20% in medical costs by 2015.
WellPoint is responding to a desire in the medical community to incentivize more proactive preventive treatment. This includes immunizing children, monitoring diabetics' blood-sugar tests, and even planning outpatient care after hospital discharge. PCPs generally make less than half of what specialists make. If any agency is expected to have an impact, WellPoint's new plan is expected to be it -- the insurer has the reach of around 100,000 PCPs.
Studies have been conducted on similar, yet small-scale projects and short-term results have not been promising. This is why WellPoint's gamble is particularly risky.
Fellow insurer Aetna, which insures 18.2 million people, is also engaging in its own similar program of incentive-based payment for primary care.
Commentary:
Let me see if I truly understand this. The second largest insurance company in the country is going to pay doctors more to provide for better care. Does that make any sense?
Their rationale is that by incentivizing doctors that will make patients healthier over time and costs less money that they will pay out. What I am confused about is why these doctors are not providing excellent care already. Why do the health insurance companies believe that by paying doctors extra, the doctors will provide better care? How much is extra? Can't you envision a discussion between the doctor and the insurance company as follows:
“You only paid me an extra $50 in order to give better care to Mrs. Jones. I want $200 dollars.”
“Sorry, our guidelines say that if we pay you an extra $50, you can give her an extra one or two blood tests but no more. If you want to order more tests, you have to do it on your own dime.”
“But how come my competitor gets $100 extra for every patient receives?"
“Because he sees more patients than you do and is more profitable.”
I just don't get it. Do you? If you do, tell me how and why this concept makes sense.
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