Spotlight on payment reform in Massachusetts

By Chelsea Conaboy, Globe Staff

The September issue of Health Affairs is focused on new ways of paying for health care, and it is chock-full of contributors from Massachusetts.

A major piece of payment overhaul today is the idea that doctors will change the way they manage care for their sickest patients if they get to share in some of the financial benefits of doing so. Ultimately, they could also lose money if they cost insurers more than expected.

A group of Boston researchers have created a primer for doctors and policymakers considering such shared-savings programs, which lead author Joel Weissman, Harvard professor and deputy director of the Center for Surgery and Public Health at Brigham and Womens Hospital, called weigh stations on the road to a fuller health care overhaul.

Many large doctor or hospital groups already have the infrastructure and know-how to assume some of the risk in caring for their patients, or to accept the possibility of losing money. Five hospital systems in Massachusetts are taking steps to do that as part of the Medicare Pioneer program.

Small practices just need to be brought along gently, Weissman said in an interview. Even the benefits-only programs are very complicated and very difficult to negotiate, he said.

Along with Needham health care consultant Michael Bailit and others, Weissman laid out a set of principles for policymakers and physicians to consider. Payers and providers must agree on the point at which they will share savings, because smaller variations in costs could be related to chance and not actual changes in how doctors treat patients, they wrote.

As often as possible, they said, payers should join forces so that doctors are not trying to meet different goals on cost and quality for each insurer.

The lack of a coherent and unified program works at cross purposes with true system redesign, they wrote. If only a minority of payers participate, then the size of the incentive may not be big enough for provider participation to be worthwhile. As a result, providers find themselves with one foot in the accountable care world and another foot in the volume-based world.

Austin Frakt, Boston University assistant professor and health economist at VA Boston Healthcare, compared accountable care organizations with the failed capitation model of the 1990s, when doctors were put on a strict budget for each patients care.

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Spotlight on payment reform in Massachusetts

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