Insurance firm has incentive for primary care doctors

In a bid to boost beleaguered primary-care doctors and encourage more preventive care for the public, Independence Blue Cross announced a plan Thursday to pay physicians more if their patients' health improves.

Independence, the region's largest health insurer, will spend an extra $47 million a year to increase base pay and double incentive programs that already encourage primary-care doctors to deliver higher quality and less costly care.

Starting July 1, a doctor with 850 Keystone HMO patients could earn up to $150,000 more a year, said Steven Udvarhelyi, executive vice president of health services at Independence.

"We think this is a significant opportunity for primary care physicians who are doing a good job," he said. "It is a great incentive for them to improve over time."

Eric Grossman, a senior partner at the consulting firm Mercer, in Norwalk, Conn., said that while insurers have dabbled with so-called pay-for-performance models, Independence's effort was a significant development.

The insurer "has definitely, by this announcement, inserted themselves into the early adopters of that movement," Grossman said.

A key element of the program rewards doctors who meet standards as so-called patient-centered medical homes. Such practices offer greater access for patients, follow treatment guidelines, educate people to better manage their own health, and prescribe drugs by computer.

The initiative expands on a number of local and national efforts that seek to transform the way primary care is delivered and financed. One goal is to ease a primary-care doctor shortage that is likely to worsen as millions of uninsured Americans get insurance coverage in 2014.

"We are doing this . . . to create the right foundation for real reform in the way care is delivered," Udvarhelyi said.

Philadelphia internist Richard Baron applauded the effort, but said he fears it will fail to alter medical practice unless other insurers here and the giant federal Medicare program join in.

"I am thrilled that they are talking about bringing increased resources to primary care," Baron said. "But I hope we will have more of a conversation about what those resources are and need to be."

Baron and the four other doctors at Greenhouse Internists in the city's Mount Airy section have an electronic medical record and have added staff to gain the highest level of patient-centered home certification from the National Committee for Quality Assurance.

But he said: "I need to know that there will be an ongoing revenue stream to support the infrastructure."

Under the current payment system, doctors get paid for patient visits, but not much of the related administrative work.

In a New England Journal of Medicine article published Wednesday, Baron detailed how much time he and his colleagues spend responding to e-mail and phone calls from patients, ordering prescription refills, and reviewing laboratory reports, specialist consultations as well as X-ray and other imaging tests.

Traditionally, insurers have not paid for these tasks. But Baron argues that they are a crucial part of delivering high quality, cost effective care.

"We have to have an honest conversation about what care really is and what the work really is to deliver that care," Baron said.

Baron's group was one of the original 32 practices in Gov. Rendell's chronic-care project to improve treatment of adults with diabetes and children with asthma.

Over the last two years, the number of patients in that effort has grown from 220,000 in this region to 437,432 here and nearly 1.2 million statewide.

"We have the largest initiative in the country," said Ann S. Torregrossa, executive director of the Governor's Office of Healthcare Reform. "With nine months left in this administration, we are looking to ensure that it can continue" after Rendell leaves office.

And after almost two years, the program has had success in reducing avoidable hospitalizations and ER visits by diabetics and asthmatics.

A formal review of the program will be conducted by the Rand Corp., a nonprofit research group in California.

Independence, however, already has enough evidence that the initiative is working, Udvarhelyi said.

Overall, diabetics at practices in the chronic-care initiative have had nearly a 25 percent improvement in their blood-sugar levels and blood pressure. There has been a 43 percent improvement in patients meeting cholesterol goals, and far more diabetic patients are getting recommended foot and eye examinations.

Moreover, he added, "the physicians who are practicing in a medical-home model are much more satisfied with their ability to provide good care to their patients. And patients are more satisfied with the access to care in those practices."

The insurer's new plan will be available to all 1,800 general practitioners, internists and pediatricians who treat Keystone HMO and Point of Service patients in the five-county region.