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Maine Insurers Take Different Approach to Paying Doctors, in Effort to Cut Costs

Patty Wight

PORTLAND, Maine - Insurance companies are starting to pay primary care physicians in Maine a little differently, in an effort to improve care, and reduce expensive hospitalizations. They're giving doctors reimbursements upfront, to cover the cost of outreach and forms of care that come outside a patient visit. Some health policy experts say these programs are another step in the right direction.

Years ago, Portland internist Dr. Tom Claffey says he noticed a problem with the way patients with chronic conditions were being treated. Their care was sporadic and reactionary.

"The delivery of care needed to change from engaging patients when they came to see us, to outreach and monitoring people and looking at their chronic conditions and managing those on a continuous basis, rather than an intermittent basis," Claffey says.

So Claffey, who is also the president of Intermed, says the physician group decided to try something new. They had nurse practitioners and physician assistants review medical records to identify the sickest patients. They'd call those patients to remind them about important screenings. They'd meet with them to identify any social or domestic issues affecting health. They extended office hours into evenings and weekends.

But Claffey says this kind of outreach wasn't covered by insurance. "And so it was something, essentially, we funded for a while, 'til we had conversations with insurance companies that showed them there was value in what we were doing."

Now, some insurance companies are putting money into the approach.

"What we're trying to do is to transform how practices actually deliver care to their members, and also pay them differently so they can accomplish those changes," says Dr. Jeff Holmstrom, a practicing family physician, and also the medical director at Anthem, which last year launched its so-called Enhanced Personal Health Care Program in Maine. It pays primary care physicians a set amount per month - around $3 per patient - to invest in infrastructure to deliver quality care.

"We give them money upfront so they can hire a nurse practitioner or a care coordinator, or maybe have a relationship with a mental health provider in their office," Holmstrom says, "things that traditionally primary care couldn't afford the way it was paid."

Some insurers also let physicians know, for example, when a patient hasn't filled a prescription. The insurance companies also evaluate physicians' performance and help them improve. The goal, says Holmstrom, is to have a physician-led, coordinated approach that improves the quality and efficiency of care. And part of that is reducing hospitalizations.

"We don't want people admitted for asthma. We don't want people admitted for congestive heart failure or pneumonia," he says. "And the rationale is, we're not against people being hospitalized, but we think that If they're well managed in the office and at their home, you can avoid the hospitalization."

Anthem spent about six years developing the program and $1 billion to implement it across 14 states. They're betting that investment will pay off in reduced health care costs. Other insurance companies, such as Maine Community Health Options, Harvard Pilgrim, Cigna, and Aetna each have various policies and programs that pay physicians upfront to improve care.

Lisa Letourneau of Maine Quality Counts, an organization that works to improve health care, says insurers are doing what she's hoped they would ultimately do, "which is to, again, institutionalize payment for this, recognizing that changing the way we pay for and provide primary care is really fundamental to a whole set of wider health care delivery transformation efforts."

Independent health policy analyst Mitchell Stein says these payments also recognize the value of primary care physicians, including financially. "Specialists have been much more highly compensated than the PCPs. So to me this moves it back in the right direction and tries to balance the scales," Stein says.

Lisa Letourneau of Maine Quality Counts says it's an important step away from fee-for-service health care. But she says there's still a lot of work to do to unchain physicians from that system and offer coordinated care for all patients.