3 health insurer CEOs on future of fee-for-service payments

The pandemic has renewed calls for value-based alternatives as fee-for-service models place pressure on providers who are facing large volume declines.

A panel of health insurance CEOs discussed the topic during a session at the Becker's Payer Issues Virtual Summit Aug. 3. The panel included Michael Carson, president and CEO of Harvard Pilgrim Health Care; Ceci Connolly, president and CEO of the Alliance of Community Health Plans; and John Kao, CEO of Alignment Healthcare. Morgan Haefner, editor at Becker's Healthcare, moderated the panel.

Here are three quotes on the matter from the conversation, lightly edited for clarity. To view the full session on-demand, click here.

Michael Carson: "As much as I would love to flip the switch and get us there, there's a lot of trust to be built between the payer and provider communities. We have to address the fact that one size doesn't fit all. We need to be creative in how we drive the value-based care agenda. Telehealth, I think, is a great example of that. If one day we're paying a capitated rate, we're not arguing about what a telehealth visit cost versus an in-person visit cost. In some instances there may be surplus money, or providers might have to pay some money back, but you get the resources you need to take care of the patient."

Ceci Connolly: "I'm a realist, sitting here in Washington after several decades. And I know that there are going to be powerful forces in the industry and in Washington that are already arrayed in support of continuing our misaligned, perverse incentives and fee-for-service, but hopefully any thoughtful person that reflects on the experience of the last few months can see that fee-for-service has not served our nation well. We saw all of these physician group practices that have been dangling by a thread because they only maybe had a couple of weeks of cash available. What I can tell you is that for the provider entities that were already in an integrated system or had value-based partnerships, they were able to focus on delivering care, often via telemedicine, rather than trying to chase volume."

John Kao, CEO of Alignment Healthcare: "Value-based care models are going to include more virtual care components. Within that care-delivery supply chain, you're going to see a lot of those popping up and financially getting into value-based care now and prepayment. Not that they didn't the first time, but they kind of had the foot on the dock and the boat thing going on, which I think was very real. I think they're going to have to bite the bullet this time, just because it scared them. And a lot of the big delivery systems have been challenged."

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