HEALTHCARE PROVIDERS SHOULD PREPARE FOR END OF FEE FOR SERVICE PAYMENTS
Medicare reimbursement has slowly changed from a system primarily based on fee for service to a system paying for treatment of a population. Physicians and other providers who have relied on Medicare have seen payments reduced and general income levels decline as a result.
Covered California and Value Payments
Reinforcing the view that medical care can be less expensive if incentives are put in place for providers, Covered California has always promoted the utilization of value payments over fee for service for physicians and other healthcare providers. They view it as a method to reward quality care and patient satisfaction, even though it is having the effect of reducing payments to providers, making medicine more corporate medicine and driving smaller practices out of business. This has happened with similar Medicare reforms.
The Model QHP Contract
The Covered California Board has been considering its contract with Qualified Health Plans (“QHP”) for the coming years. A review of the 2017 Qualified Health Plan Contract and Attachments shows that the Covered California Board is continuing its advance to reform payment models under the Healthcare Exchange.
The Qualified Health Plan Model Contract (“Model Contract”) is the agreement entered into between the Qualified Health Plans (“QHP”) and Covered California. The contract sets the terms for the QHP operate under in order to participate in California’s healthcare exchange. These contracts have become the major method by which Covered California promotes its major policy initiatives, such as appropriate healthcare networks and payment reform to healthcare providers.
The Model Contract specifically references federal policy on incentivizing quality by tying payments to providers by measuring performance. When providers meet specific quality indicators or enrollees make certain choices or exhibit behaviors associated with improved health, providers receive a higher level of payment. Such policy requires quality reporting, care coordination; chronic disease management, patient-centered care, evidence based medicine and health information technology. (Quality Improvement Strategy: Technical Guidance and User Guide for the 2017 Coverage Year.)
Attachment 7 to the QHP Model Contract
Attachment 7 to Covered California 2017 Model Contract provides the meat of the policy. According to Attachment 7, QHPs are to work with Covered California to create healthcare networks that are based on value. By working with Covered California, all QHPs will share data which they have received from providers across the state. The plan also contemplates meetings where best practices are discussed.
QHPs Must Select Healthcare Providers Who Are Utilizing Quality Measurements
Under Attachment 7, all plans must include “quality” measurements in the selection and utilization of providers, including “clinical quality, patient safety and patient experience and cost.” Covered California will carefully monitor the plans to assure that that QHPs only contract with providers and hospitals that demonstrate quality care.
QHPs are to ensure that providers which are serving enrollees with conditions that require highly specialized management have “documented special experience and proficiency based on volume and outcome data.” Attachment 7 further specifically requires the submission of the Consumer Assessment of Healthcare Providers and Systems, developed by the Agency for Healthcare Research and Quality. The CAHPS requests information from the consumer experience, including:
Asking about aspects of care for which a patient or enrollee is the best or only source of information.
Asking about the aspects of care that patients say are most important.
Asking patients to report on the health care they receive.
Reflecting input from a broad spectrum of stakeholders, including patients, clinicians, administrators, accrediting bodies and policymakers.
Finally, Attachment 7 promotes the use of Patient-Centered Medical Homes as well as integrated care models, with quality and patient satisfaction as key data points; population-based care, including integrated care; utilization of electronic health record technology, including utilization of data for results management and clinical decision support and patient support.
2017 continues the trend toward value added care. Physicians and other providers should start preparing practices for this new payment models if they intend to continue in medicine.
By Matt Kinley,Esq., LLM, CHC