BCBS of Massachusetts to pay hospitals to keep patients out

Blue Cross Blue Shield of Massachusetts wants to change the way hospitals are paid.

That's what the state's largest health insurer is pursuing in a new three-year pilot with South Weymouth, Mass.-based South Shore Health System. Under the pilot, the health insurer will pay the hospital to work with physicians, whether they're affiliated with the hospital or not, to better coordinate care outside the hospital.

Patients are often treated in hospitals closest to where they live, regardless of whether their primary care physician group is affiliated with a hospital in a different location. However, the new program will reward South Shore Health System for sending patients to an appropriate care setting, whether that be an unaffiliated physician's office, an urgent care center, a hospital or a patient's home, the health insurer said.    

The program builds off of a payment reform BCBS of Massachusetts implemented a decade ago across most of Massachusetts' physician groups. Under the Alternative Quality Contract, physicians are financially rewarded for meeting specific quality standards; however, the model has failed to change hospitals' volume-based payment incentives.

By moving the global budget payment model to the hospital setting, BCBS of Massachusetts aims to lower emergency department wait times and keep South Shore Health System beds open for patients needing acute or complex care.

"What's so encouraging about this partnership is that the provider and the payer are finally coming together at the same table with the same goal: drive down costs without affecting quality of care," South Shore Health System CEO Gene Green, MD, said in a prepared statement.

BCBS of Massachusetts intends to expand the program to other hospitals should the pilot succeed.

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