Once we decide what X% is, we can decide what Y% of the claims will be. If X% is 70%, Y% can range from 40% to 0%. X% + Y% can be equal to 110% or less.
Explore This IssueNovember 2014
A quality, cost-effective doctor who does not underutilize or overutilize will get paid 110% of the maximum allowable fee. He/she will not only get the full value of the claims, but a 10% bonus can be added. Those who score lower will get paid between 70% and 100% of the claims.
HPS also borrows but modifies the principle of “HMOs withholding” of a prior era. In the eighties, the return of the “withhold” depended on the total performance of all the providers in the network and the financial health of the HMO. In this new HPS, each provider is measured according to his/her own performance. Hence, we are holding each provider accountable for his/her actions according to the criteria set by pay for performance. His or her compensation is thus not dependent on other physician performances.
The old “capitation model” or putting providers on salary without incentive will lead to less “access” for the patients, encouraging underutilization as well as making the provider want to pass the patient on to another provider (or refer to another specialty) to take care of and incurring unnecessary extra medical visits.
This HPS methodology will decrease cost without compromising quality and access. Once rational payment systems are adopted, providers will have no conflict with their conscience to overutilize and upcode, or underutilize or limit patient access. HPS is not going to be perfect at the beginning, but once we work with it, we can amend and improve it.
K.J. Lee, MD
Associate Clinical Professor
Yale Medical School
New Haven, Conn.