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Independence Blue Cross Cutting Pay for Some Doctor Procedures by 50%

The move is an effort to spread the sharing of risk

Most value-based payment systems reward doctors for keeping costs down, but don’t detract from their pay if costs go up. But on August 1, Philadelphia-based Independence Blue Cross will begin paying up to 50% less for some procedures, the Philadelphia Inquirer reports.

“In a hypothetical example of a dermatology visit, the doctor might now get $100 for a full-body skin exam and $50 for a biopsy, if it is done during the same visit by the same doctor,” the newspaper reports. “Under the new rules, the payment for the exam would be cut to $50, for a total payment of $100, or a 33% overall reduction for the episode.”

The move doesn’t come entirely out of the, er, blue. The health plan has been looking at just how to shift some of the downside of risk to doctors for some time now. In a discussion with Managed Care in November 2015, Ron Brooks, MD, a senior network medical director at Independence, indicated that doctors who accept the rewards of a value-based system should also accept the risk. Brooks said that most physicians were not taking the downside risk.

“Meaning they don’t lose money for lower-quality measures,” Brooks told Managed Care at the time. “They simply don’t earn as much as they could if they were achieving higher quality and cost standards. In our experience, in the Philadelphia area, most physicians are currently more comfortable with upside risk arrangements. As they become more accustomed to these risk-based payment programs and are successful, they will most likely be more interested in taking on full risk.”

What prompted the insurer’s latest move? The health plan found that its doctors used a coding modifier that increases payment for an added service nearly twice as often as doctors nationwide.

Ginny Calega, Independence’s vice president of medical management and policy, tells the Inquirer: “We’re in a changing environment. We’re looking to be good stewards of our customers’ and our members’ health care dollars, and we’re benchmarking ourselves with other payers, regulators for national trends.”

Source: Philadelphia Inquirer; July 18, 2017.

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