Pay-for-Performance Case Study
Bridges to Excellence - North Carolina State Health Plan
North Carolina's Health Plan for State Employees and Teachers (State Health Plan) is the largest employer purchaser in the state. Known for its efforts to advance employee wellness progress, the State Health Plan has partnered with its insurer and with other area employers to test the Bridges to Excellence (BTE) Pay-for-Performance programs as a means to provide incentives for improved primary care Physician Performance.
At a Glance…
What motivated the State Health Plan?
In early 2006, Blue Cross Blue Shield of North Carolina (BCBSNC) invited the State Health Plan to participate in BTE. BCBSNC was motivated by a desire to demonstrate whether or not a provider recognition and reward program could measurably improve care and cost-efficiency in its market.
The State Health Plan decided to participate in hopes of impacting longer term medical cost projections.
The State Health Planwas one of the initial purchasers to participate in BTE in order to bring effective care together with systems to ensure consistent care delivery and to reinforce the goal of improving health care quality and value. The State Health Plan joined the North Carolina Collaborative, which included a host of local employers and health plans that operate in the state and have licensed BTE. In addition, the State Health Plan partnered with its contracted health plan, BCBSNC, to sponsor a three-year pilot.
Other participating insurers in the broader North Carolina Collaborative included Aetna, Cigna, and UnitedHealthcare. Other participating employers included Cisco, IBM, GlaxoSmithKline, Duke Energy, Belk, and Novant-Presbyterian Healthcare
What was the State Health Plan’s objective?
The State Health Plan and BCBSNC set out to test the BTE model – “to reward physicians and physician practices for delivering safer, more effective and more efficient care through incentives and recognition.” The specific pilot objectives were:
- better health for members;
- long-term medical cost savings, and
- overall affordability.
What was the State Health Plan’s strategy?
BTE recognition was made available to North Carolina practices through the National Committee for Quality Assurance (NCQA).
The BTE model provides annual payment to recognized practices for each employee of a participating employer with the specific recognition program condition, or for Physician Office Systems, for all patients. Payment amounts are informed by BTE’s analysis of the superior cost efficiency and quality of practices that are recognized relative to those that are not.
A practice can be recognized at three levels for each program, with increasing payment at each level
The State Health Plan pilot with BCBSNC provided physicians with extensive support and guidance as they proceeded through the NCQA recognition process. Methods of support included help from quality management consultants, monthly meetings and reimbursement of NCQA fees after achievement of NCQA recognition. The Pay for Performance component of the program had two and three levels of payment that varied during the three years.
The pilot focused upon diabetes, cardiac care and internal physician office practices.
The payment model was as follows:
Rewards were paid for BCBSNC-attributed underwritten and administrative services-only (ASO) members. Rewards were based on the BCBSNC and State Health Plan members with a claim for an office visit in preceding year.
Patient attribution to primary care practices was conducted annually using BTE’s methodology.
The reward amounts per program were determined by BCBSNC and aligned closely to BTE model amounts:
$80 per diabetic patient per year;
$80 (level 1) OR $160 (level 2) per cardiac patient per year;
$15 (level 1) OR $35 (level 2) OR $50 (level 3) per member/year for Physician Office Systems
Awards were given an annual value, but distributed to provider practices on a bi-annual (twice-a-year) basis.
What challenges did the State Health Plan face?
- There were more practice applicants than there was available space in the pilot, so some practices had to be turned away.
What results were achieved?
The pilot program resulted in measurable reductions in specialist visits, high-tech imaging and hospitalizations, probably because better care coordination made them unnecessary.
An analysis of claims conducted by BCBSNC's Clinical Informatics unit for practices that submitted applications in the first recognition cycle of the pilot of the pilot reported positive results:
$4.2 million in rewards was paid to 194 physicians in 41 practices.
Lower health care spending per patient was observed among recognized physicians. Patients of the doctors recognized through the physician office system program, which focused upon information systems, patient education and care coordination, received high-cost radiology services (e.g., CT scans and MRIs) at a rate 12% lower than the control group of non-participating physicians. The same group of patients was 34% less likely to visit the ER and 24% less likely to see a specialist. There was no statistical difference in hospital admission rates between the two populations.
Patients of the doctors recognized through the diabetes program were much more likely to have a good blood pressure reading (defined as 130/80 or less).
BCBSNC concluded that “These results provide a basis for continued inclusion of BTE recognitions in our primary care recognition programs.” BCBSNC has introduced its Blue Quality Physician Program as a result of its successful BTE quality improvement program.
The State Health Plan concluded that the most powerful impact on cost and quality appears to result from transitioning care management to local primary care providers who have a close relationship with patients, thereby strengthening the medical home. As a result, it has shifted the emphasis of its population health management programs to more of a medical home strategy.
What advice do the State Health Plan, BTE and BCBSNC have for employers?
Large employer involvement increases the likelihood that practices will engage.
It is extremely helpful to have a strong partner for implementation and evaluation, as was BCBSNC is this instance.
Members and providers must be engaged for the initiative to be successful.
Like the State Health Plan, most of the participating employers in the North Carolina Collaborative have been large, self-insured employers. However, if an employer is a member of a coalition, that can work too. An employer could work with its coalition to create a BTE Pay-for-Performance program.
 Interviews with Chad Brown, Bridges to Excellence and Ann Rogers, North Carolina State Health Plan for Teachers and State Employees; correspondence with Genie Komives, Vice President and Senior Medical Director, Blue Cross Blue Shield of North Carolina; http://www.bridgestoexcellence.org/Content/ContentDisplaye3e2.html?ContentID=162; http://www.shpnc.org/board-materials/August-2009/bridges-to-excellence.pdf, and http://www.bcbs.com/news/plans/bcbsnc-sees-improved-health-quality.html.