Citing Cost Reductions, Highmark to Expand PCMH Initiative

"Our goal would be that in the future, physicians who drive value—meaning higher quality indicators and an overall more reasonable trend or cost—will get more money than they do today in a fee-for-service system. But they will be paid based on that value and not on just driving more units of service. That is what we want to get to."

Highmark said the results from the pilot program showed that:

• Inpatient acute admissions dropped on average for the pilot practices by 9%
• 30-day readmission rate dropped on average for the pilot practices by 13%
• Seven-day readmission rate dropped on average for the pilot practices by 14%
• There was a 5% decrease in total per-member-per-month costs for coronary artery disease members and a 3.5% decrease for diabetics during the pilot

Fiaschetti says the key to success with the PCMH is to get physicians to embrace the team approach, and for the payers to reward success.

"In their offices they would have care coordinators who would spend more time with the chronically ill patients and get them the right level of care, get them the right education, and coordinate their care in a more intense fashion," he says.

"In exchange, we are going to provide higher incentives for better managing those patients based on certain quality and cost parameters. Quality will always be 50% of the incentive equation. We aren't going to compromise quality for cost. This isn't the old days where that may have happened 20–25 years ago in some of the old HMOs. It is very much a blend of cost and quality."