NJ Health Insurers Tying Payments to Performance

Friday, 24 Feb 2012 05:20 AM

By Sandy Fitzgerald

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New Jersey health insurers are working on new models tied with incentives to improve the quality of care, in hopes of bringing healthcare spending under control. The new models include quality and performance standards, according to njspotlight.com, and expand the roles of nurses and other providers to act as advocates involved in follow-up and prevention.
 
“We know the world is changing, and we need to change the way the healthcare delivery model is set up, the way we reimburse providers, and try to make healthcare more affordable,” said Michael McGuire, chief executive officer of UnitedHealthcare of New Jersey.
 
The insurer will pay more to hospitals that hit higher performance targets, McGuire said, but will still save money in the long run.
 
“The metrics we are looking at will overall reduce the cost of care,” McGuire said. “If lengths of stay go down, if re-admissions go down, if hospital acquired infections are down, then the overall cost of care goes down.”
 
The new methods are quite different that the insurers’ traditional healthcare funding.
 
Dr. Dan Nicoll, a Cigna regional medical executive for the Northeast, described the traditional method as: “You go to the doctor, you have your office visit, you have your 20 minutes. Then you go home, the doctor goes home, and it’s all over.”
 
Under the changes, doctors’ practices will be paid to coordinate care after the office visit as well.
 
Meanwhile, about 15 percent of the New Jersey hospitals in the UnitedHealthcare network are in performance-based contracts, but McGuire wants to bring 80 percent of the company's hospital spending in New Jersey under similar agreements.
 
The Medical Society of New Jersey doesn’t object to the new payment models, but chief executive Lawrence Downs said they must pay physicians and hospitals fairly.

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