Return of capitation? Massachusetts insurer expands global payment model

Further signifying a “fundamental” change in health care reimbursement, Blue Cross Blue Shield of Massachusetts (BCBSMA) last week announced a five-year agreement with Boston-based Caritas Christi Health Care that revolves around a global payment system rather than the standard fee-for-service model, the Wall Street Journal reports.

According to the Journal, Blue Cross Blue Shield of Massachusetts Inc. is expected to announce Friday a deal covering 60,000 members of the Caritas Christi Health Care system, marking one of the country's largest experiments in fundamentally changing the way doctors and hospitals are paid.

In most of the U.S. health-care system, doctors and hospitals generally earn money when people get sick, under a reimbursement system known as "fee for service." But Blue Cross is trying to change the payment model to a system in which doctors and hospitals earn more by keeping patients healthy and out of doctors' offices and hospitals.

If successful, the approach offers a potential model for the rest of the U.S. Legislation to overhaul the health-care system pending in the Senate calls for Medicare to set up small experiments to change reimbursement in ways similar to what Blue Cross is attempting.

Click here for a related article in the Boston Globe.

(SOURCES: Advisory Board Daily Briefing, http://advisory.com, December 1, 2009; The Wall Street Journal, http://online.wsj.com, accessed December 2, 2009)