Insurer to reward patients for finding cheaper care
By Robert Weisman
The Boston Globe, December 20, 2011Told they need a routine medical test, such as a colonoscopy or a mammogram, most patients go wherever the doctor recommends. But under a program being rolled out next month by Harvard Pilgrim Health Care, they could be paid to seek care somewhere else.
The health insurer plans to introduce a rewards program through which its Massachusetts members who have been given referrals will be asked to call a “clinical concierge” service that can direct them to hospitals or medical facilities that charge less for the same tests.
In return, they will receive a check from Harvard Pilgrim, ranging from $10 to $75.
The program, called SaveOn, is intended to help patients make smarter health care choices, according to Harvard Pilgrim, and to rein in the runaway prices of imaging tests and other procedures that have contributed to steadily rising premiums.
On the customer side, health insurers have been selling employer groups limited-network plans, which restrict which providers patients can see, and tiered-network plans, which require them to pay more to visit higher-priced physicians or medical centers.
But SaveOn, which has already been introduced as a pilot on a limited scale in New Hampshire, will be the first in Massachusetts structured as a rewards program, similar to those offered by online retailers for shopping at their stores.
The role of employers in educating their workers will be key to the adoption of SaveOn because employers typically pick up the largest share of health insurance costs.
But if the program succeeds in moderating reimbursements for everything from MRIs and CT scans to ultrasounds and sleep studies, employers will probably want their own financial reward.
Harvard Pilgrim’s (chief executive Eric H.) Schultz said he hopes SaveOn will help the insurer sell products and gain market share while driving down health care costs, one procedure at a time.
“This becomes a conversation at the watering hole – ‘I just got a check for $75,'” he said.
Harvard Pilgrim Health Care will be offering cash rewards to patients who ignore their physicians’ recommendations and instead consult with the insurer’s “clinical concierge service” on where to obtain their imaging tests and other procedures. When there has been a big push to further integrate health care services, is it wise to establish a policy that disrupts usual referral patterns that have at least some minimal semblance of integration?
Harvard Pilgrim’s chief executive visualizes the conversation at the watering hole wherein one worker tells his fellow worker that he just got a $75 kickback from the insurance company. What is the fellow worker to think? “Since I don’t need care, I don’t get a kickback. Yet I have to pay a higher insurance premium so this jerk can get a cash reward using my premium dollars?”
This is yet another scheme to make patients informed shoppers in the health care market by making them sensitive to the costs – or cash rewards! – for the health care they choose. It doesn’t seem to matter that this may be an illegal kickback, especially if Medicare or Medicaid funds are involved. The cash rewards are inevitably passed onto whomever is paying the bills.
Instead of making patients complicit participants in this devious scheme, wouldn’t it be better to establish policies that gets the prices right in the first place, so that there is no extra $75 available to use as a cash reward?
We do know how to do that. Government administered pricing, such as with the Medicare program, does a much better job than the private insurers at setting prices at appropriate levels. This is not merely an opinion, but has been confirmed through extensive policy research.
In our current fragmented system of financing health care, some may disagree that Medicare pricing is appropriate, but if Medicare were the only payer, pricing decisions would be even more precise and appropriate. The public administrators have to pay enough to maintain the financial viability of the health care delivery system, yet not so much that those paying into the system are not receiving a fair value.
Addendum: PNHP co-founder, David Himmelstein, M.D., provided this response:
I’m a Harvard Pilgrim enrollee (as a Harvard retiree). This week my long-time physician at Beth Israel hospital in Boston referred me for a test and dolefully informed me that I would be charged extra if I chose to have it done at Beth Israel rather than at a no-name place with which he has no association, and no established lines of communication. I declined to go brand X for the test.