; Premera Blue Cross And Washington Providers Collaborate On Healthcare Redesign
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Press Release

Premera Blue Cross And Washington Providers Collaborate On Healthcare Redesign

Unique payment model manages costs and helps improve quality of care

June 6, 2012

MOUNTLAKE TERRACE - Premera Blue Cross today announced the expansion of its Global Outcomes Contracting model, an innovative approach to working with healthcare providers that is reshaping the healthcare delivery system in the Pacific Northwest. Premera is one of the first health plans in the country to offer this type of payment model, which rewards cost-effective, evidence-based care. 

Across Washington state 12 major physician groups and an independent physician association, who combined manage care for nearly 100,000 Premera members, have joined this effort to help control costs while improving quality of care for patients. Through Premera’s new payment model, groups are being rewarded annually based on a combination of the cost savings they demonstrate and the quality of care they provide to their patients’ total health over the course of the preceding year.

Initial results indicate this new approach is beginning to help moderate rising medical costs, as the first groups who are participating in Premera’s new payment model are seeing results.  For example, the total health care cost trends last year for Premera patients managed by The Everett Clinic and The Polyclinic were 3-5 percent below the average of other Premera patients in the same region who have a regular physician, after accounting for differences in health.1

“Our goal with this initiative is to provide a new financial model for rewarding the delivery of high quality care to our members that improves their total health,” said Rich Maturi, senior vice president of Health Care Delivery Systems at Premera Blue Cross. “The results prove this model is making an impact and we’re thrilled to collaborate with a growing number of providers to move the current healthcare delivery system toward a model that is both patient-focused and financially sustainable.”

Many traditional models for changing the inefficient fee-for-service system focus only on specific cost measures. Premera’s new payment model takes it a step further by examining the total cost of the patient and also incorporating an important quality component.  This ensures that costs are contained without a reduction in the quality of care for patients. In addition, the physician groups participating in this initiative are implementing new strategies to improve quality and control health care costs.

“Under the current fee-for-service payment model, providers receive a fee for each test or procedure.  Not surprisingly, this payment system encourages overuse and drives up costs,” said Rick Cooper, chief executive officer of The Everett Clinic.  “With the outcomes payment model however, providers are being rewarded for keeping patients healthy through prevention, care coordination and disease management.”

“At The Polyclinic, we are grateful Premera has broken through ‘the chicken and the egg’ dilemma of the current financing of health care,” said Dr. Michael Tronolone, chief medical officer of The Polyclinic. “Providers are stuck in a reimbursement system that allows for minimal investment in innovative care delivery. Changing reimbursement from a pure fee-for-service system to one based on performance - achieving better outcomes and lower costs - gives us a chance to finance care process improvements. The fact that we were successful now allows us to fund further innovation. We are excited about the possibilities.”

Additional groups participating in Premera’s new payment model include: Family Care Network, Franciscan Medical Group, Northwest Physicians Network, Pacific Medical Centers, Pediatric Associates, Puget Sound Family Physicians, Rockwood Clinic and Wenatchee Valley Medical Center.

About Premera Blue Cross
Premera Blue Cross is a leading health plan in the Pacific Northwest, providing comprehensive health benefits and tailored services to more than 1.5 million people, from individuals to Fortune 100 companies. Premera is committed to providing its members peace of mind about their healthcare coverage. The company offers innovative health and wellness solutions focused on quality outcomes for patients and controlling costs. Premera Blue Cross, which has operated in Washington since 1933, is a not-for-profit, independent licensee of the Blue Cross Blue Shield Association.

Premera Blue Cross is a member of a family of companies based in Mountlake Terrace, Wash., providing health, life, vision, dental, stop-loss, disability, workforce wellness and other related products and services. The family of companies employs approximately 3,000 people and provides healthcare coverage and related services to nearly 1.7 million members. Please visit www.premera.com  and www.PremeraNews.com for more information.

The Blue Cross and Blue Shield Association is a national federation of 36 independent, community-based and locally-operated Blue Cross and Blue Shield companies that collectively provide healthcare coverage for more than 105 million members – one-in-three Americans.  For more information on the Blue Cross and Blue Shield Association and its member companies, please visit bcbs.com. We encourage you to connect with us on Facebook, check out our videos on YouTube, follow us on Twitter and check out The BCBS Blog, for up-to-date information about BCBSA.