The Slippery Slope of Value
This morning United Health Care announced its new Cancer Care Payment Pilot. According to UHC, this pilot is designed to “advance a new cancer payment model that focuses on best treatment practices and better health outcomes.” As a matter of fact, most agree that the cost of treating cancer under the current model is unsustainable. As evidence for this position, Dr. Michael Neuss, an oncologist from Cincinnati, described existing payment plans that reward physicians for using expensive chemotherapy medications as “our dirty secret” in today’s New York times. In this world of the “new normal” of healthcare reform, I am “all for” exploring new models of care that attempt to provide the best care at the best price, but that does not appear to be the true goal of this model.
In reviewing the details of the model as outlined by UHC, this new pilot will reimburse providers utilizing a bundled payment plan based on the “expected cost” of treating a patient. The physician will choose the care plan, but all reimbursement will be independent of the drugs that are chosen to treat the patient. Basically, the physician will get a flat fee for what it should cost for him/her to see the patient in the office, plus a bit of a bump for case management and drug administration. The drugs will be reimbursed at cost, removing any profit incentive for the physician.
So far so good right? Not so fast. Although the disincentive for profiting on medications may lead to lower costs, what incentive will there be for truly improved quality and better care? Reading on in UHC’s press release, they do mention that they will be measuring the number of emergency room visits (a cost measure), the incidence of complications (a cost/quality measure), and “health outcomes.” Exactly how they will be measuring outcomes is not said.
Even if you give UHC the benefit of the doubt that they are going to create robust, meaningful, outcomes-based quality metrics (which I am admittedly skeptical of), they have missed the boat on one very important piece of this equation. None of these quality metrics appear to be tied in any way to the physician’s income. How much the physician is paid is tied solely to the time likely to be spent caring for the patient – a bundling of expected fee for service payments, nothing more.
Creating appropriate incentives for any behavior is complicated, but B.F. Skinner showed long ago that negative reinforcement is short-lived. If you desire to have long-term change, you must reinforce a desired behavior. We must create new models that help us reign in cost. However, without including positive financial incentives that reward the best care, we will simply end up with another band-aid approach that rewards the payer, frustrates the physician, and fails to provide incentives to improve the outcomes of those at the center of care, the patients.
As we continue to move further down the path of healthcare reform, finding ways to focus on and measure the quality of clinicians is generating more and more discussion. An article published this week in the Columbus Dispatch highlighted the 
As a father of three teenage boys, my life is rarely dull. Their insights and slant on most things are generally entertaining to say the least. Last night as I was sitting at my dinner table, my 16 year old son caught my attention. “Dad, the folks who make video games have got it figured out. They are marketing geniuses. They must be rolling in money.” Curious, I asked what he meant. He went on to share with me that on his new gaming system, there was a small avatar that sat in the lower right hand corner of the screen. According to my son, this avatar had no purpose whatsoever. It was not part of the game. It didn’t even move. It just sat there and blinked. The gaming company, it seems, has developed a system of buying “points” as imaginary money and with this money you can customize and dress your avatar in any way you wish. My son, perplexed by this, said “Dad, why would anyone buy something that has absolutely no value?”
I work with clients daily who are trying to best prepare themselves by implementing quality-based incentive compensation into their physician alignment strategies. As healthcare reform continues to be better understood and begins to be implemented, it is critical that hospitals understand how these bonuses/penalties will work.
