Harvard Pilgrim Health Care has reached a new deal with Massachusetts' largest provider, Partners HealthCare System, to help control costs with a new global payment arrangement that gives providers a fixed amount of money each year to care for patients.
The re-negotiated contract limits reimbursement increases to 2 percent and 3 percent annually and creates a budget for Partners' hospitals and doctor practices, including Massachusetts General and Brigham and Women's hospitals. Although the agreement is retroactive to Jan. 1, Harvard Pilgrim still will pay Partners the previously agreed upon payment increases of about 5 percent to 6 percent this year, reported The Boston Globe.
If Harvard Pilgrim's fee-for-service reimbursements in 2012 surpass the global payment budget, Partners will refund the insurer with any additional payments.
The new deal means Partners now is operating under alternative payment models with Massachusetts' three biggest commercial insurers. The provider system already renegotiated its contracts with Blue Cross Blue Shield of Massachusetts and Tufts Health Plan, the Boston Herald reported.