The TriZetto Group, Inc. today made it known that QualChoice Health Insurance, Arkansas’ second-largest managed care company, is using TriZetto software to administer episode-based payments to physicians who provide cardiac stents, perinatal care and hip and knee replacements for its group and individual health plan members, according to a statement.
Arkansas has almost twice as many pregnant teens as the rest of the country – 52.5 percent as compared to 34.3 percent – so good healthcare is critical in this state.
Episode-based payments reimburse providers on the basis of expected costs for
episodes of care, usually to contain the cost of services. Health information exchanges – the linchpin of the health reform act – will pay providers based on outcomes and quality of care, not just hand over lump sums, as in the past – all for reduced costs and better healthcare. HIEs are the basis for the new payment model.
Under the new payment model, physicians and facilities will share cost savings or be penalized for failure to meet performance goals, based on how well they complete episodes of care at appropriate cost and quality levels, rewarding value rather than volume.
Little Rock-based QualChoice is joining with Medicaid, other private payers and hundreds of physicians, healthcare professionals and other stakeholders to implement the Arkansas Health Care Payment Improvement Initiative, which began on July 1, the press release noted.
Participants in the state-sponsored program use an episodic-payment model to control costs and reward healthcare providers who deliver high-quality, coordinated, cost-effective care to patients.
Under the program, all treating providers will continue to file claims as they do today and will be reimbursed according to each payor’s established fee schedule. However, the payors will then identify a principal accountable provider (PAP), the provider with the “most influence and responsibility over an episode,” to share in savings or in excess costs, “determined by comparing the PAP’s average cost for all episodes against the predetermined cost thresholds for gain and risk sharing,” according to the initiative’s website.
“QualChoice chose TriZetto’s payment-bundling administration solution because it automates and streamlines retrospective and prospective episodic-payment models,” said Michael E. Stock, president and CEO of QualChoice. “Under the state program, physicians and facilities are rewarded retrospectively – months after the service – with shared savings for meeting quality and cost standards for select episodes of care. Beginning in 2013, however, QualChoice will have the ability to reward providers prospectively – with immediate cost savings – for meeting quality and cost targets.”
The prevailing fee-for-service model rewards providers based on the volume of care they deliver, according to the press release, while episode payment will “now focus on value-based reimbursement, aimed at motivating providers to coordinate in delivering the most cost-effective, evidence-based medical services across episodes of care.”
TriZetto’s patent-pending payment-bundling application automates and streamlines the processing of episode-of-care payments by QualChoice.
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Edited by
Allison Boccamazzo
