Blue Cross Blue Shield of Michigan has expanded its value-based hospital reimbursement model with five more health systems in the state, representing 24 hospitals, for a total of seven systems.
Under the new model, hospitals will work with their physician partners to establish an infrastructure plan that includes an all-patient registry system so that the inpatient and physician office care team can measure an individual's health outcome against similar populations.
With this approach, BCBSM aims to coordinate care among all providers who treat the same patient to improve quality and make sure that the patient gets the right care at the right time. The hospitals also will help their physician partners to develop work plans to improve the health of the patient populations that they serve.
By moving toward value-based reimbursement, BCBSM will reward the hospitals with a share of the savings realized when hospitals and physicians coordinate to deliver efficient and effective care and prevent unnecessary re-admissions.
"We can now leverage our reimbursement approach to incentivize collaboration and focus on rewarding patient outcomes," as these hospitals evolve the traditional fee-for-service payment model and take on more risk, said Susan Barkell, BCBSM senior vice president for healthcare value, in the news release.
The hospital systems just entering the value-based arrangement were Botsford Hospital, Oakwood Healthcare and MidMichigan Health. Others have expanded their reimbursement contracts, including Ascension Health Michigan and Beaumont Health System.
For example, Beaumont in 2012 signed a contract with BCBSM that kept it in the hospital network serving Blue Care Network members that increased reimbursement but also called for developing performance-based standards decided by the insurer and hospital for paying the health system in the future. The agreement incorporated maintaining improved overall population health and Beaumont working with its physician groups to better integrate care services to be more efficient in the use of tests and procedures.
Last year, the insurer crafted similar agreements with CHE Trinity Health-Michigan and Munson Healthcare.