CO hospital experiments with value-based insurance

Consumers are paying too much money for "bad" healthcare--treatments, tests and procedures that don't address their conditions effectively, a trend one hospital hopes to reverse by implementing value-based insurance, Reuters reported.

San Luis Valley Regional Medical Center in Alamosa, Colo. is conducting a two-year, value-based insurance experiment in which patients pay for procedures considered ineffective or unnecessary. The hospital hopes to encourage patients toward solutions that will help them, as opposed to less effective options, according to the article.

The experiment divides procedures in "green" buckets--inexpensive and effective procedures, such as vaccines--and "red" buckets--expensive and unnecessary procedures, such as endoscopies for heartburn, Reuters said.The hospital is conducting the experiment with its 725 covered employees and their dependents and will begin to analyze the data in 2014 to determine whether the disincentives were effective and improved patient outcomes.

The value-based insurance theory has gained momentum since the passage of the Affordable Care Act, which aims to eliminate wasteful spending on ineffective care, which adds up to a little less than a $1 trillion a year.

Some critics of the theory worry about the extent to which hospitals and providers will consider procedures off-limits and if the initiative would discourage people from getting the tests they need. "We have reservations about financial obstacles that might keep patients from getting care they need," said Joyce Dubow, senior healthcare reform director at American Association of Retired Persons.

For a value-based compensation system to be effective, providers must "embrace the messiness of disease and the complexity of patients," David A. Shaywitz, M.D., Ph.D., director of strategic and commercial planning at a San Francisco-based pharmaceutical company, wrote in The Atlantic, FierceHealthcare previously reported.

To learn more:
- here's the article

 

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