To Solve the Affordability Crisis, We Need Shared Financial Accountability
Todd Van Tol
| 3 min read
Senior Vice President, Health Care Value
Ask most anyone in the United States about the cost of health care and you’ll get the same answer – it’s unaffordable. Improving the affordability of care and coverage is a complex issue, and we believe it’s one that requires accountability from everyone who has responsibility for the costs people and businesses pay for care. That’s where we in Michigan are uniquely positioned for success. At Blue Cross Blue Shield of Michigan, we’ve been making strides toward shared accountability for nearly two decades with physicians and hospitals statewide, generating over $2 billion in savings through a broad array of value-based care initiatives. These programs typically involve data sharing, structured collaborations to share best practices, and financial incentives to recognize providers for meeting quality, cost and outcomes goals. Until now, these financial incentives have only leveraged “upside risk,” meaning providers had opportunities to earn more by doing better. To truly make an impact on affordability, however, we recognize the need to share accountability by accelerating efforts toward models that have both upside and downside risk. This is the advanced payment model Blue Cross has launched with more than a dozen large provider organizations in Michigan. Called “Blueprint for Affordability,” our risk-sharing approach now incorporates downside financial risk. This increases provider accountability for success. We recognize that the new payment model needs to be flexible enough to facilitate adoption by a range of provider groups. Downside risk isn’t easy to adopt. Provider organizations come in different sizes, from small independent physician groups to large multi-hospital health systems. A review of risk-sharing programs nationally shows organizations in two-sided (upside and downside) risk arrangements are less likely to be physician led and more likely to be integrated systems that include hospitals. So, while all stakeholders have accountability for health care quality and cost measures, we knew we needed to construct a payment model that is fair and equitable to the varied structure of the participating partner organizations. In designing Blueprint for Affordability, we listened carefully and gathered input from the many physician groups and organizations that participate in Blue Cross’s longstanding Physician Group Incentive Program. We tapped into provider experience to structure Blueprint for Affordability in a way that would enable participation from organizations of all sizes. We recognize that some provider organizations may not be fully ready to adopt downside risk. But, by working closely with them, we found that the market is ripe for a program that introduces incremental downside risk paired with upside rewards. We designed Blueprint to place financial risk commensurate to the balance sheet of the organization underwriting that risk. Each agreement is tailored to the unique make-up of the contracting organization. As a result, 14 provider organizations have already signed onto the Blueprint program, and active discussions are occurring with many more. Value-based payment models work. We introduced Blueprint to quickly make value-based risk-sharing part of how we do business on our largest, fastest-growing products – our commercial and Medicare Advantage PPOs. In the first year of the program, more than 30 percent of our in-state PPO market is covered under a Blueprint arrangement. As we advance this needed shift to more value-based models, we believe it will result in better quality and affordability for our members. We all want health care to be more affordable. We all have a role to play in making this happen. With Blueprint for Affordability, flexibility and collaboration are the keys to success. That’s our special formula. Learn more at BlueprintForAffordability.com. Related content:
- Blueprint Expansion Gives More Members Access to Patient-Focused, Coordinated Care
- Ensuring Equity in Blueprint for Affordability Contracts
- Better Care, Better Cost
Photo credit: SDI Productions
