Financial

Medicare Costs Drop As Humana Shifts Doctors To Value-Based Models

Nov 13, 2018 – Bruce Japsen, 

Humana’s shift from fee-for-service medicine to value-based payments for physicians continues to reduce costs and improve quality of care for seniors enrolled in Medicare Advantage plans, the insurer says, citing a new internal study.

Medical costs were nearly 16% lower for seniors enrolled in Humana Medicare Advantage plans that paid physicians via value-based models in 2017 compared to costs of those in traditional fee-for service Medicare, the Louisville-based insurer’s study, released Tuesday showed. Medicare Advantage plans contract with the federal government to provide extra benefits and services to seniors, such as disease management and nurse help hotlines, with some even providing vision and dental care and wellness programs.

“Humana MA value-based physicians had better results than their peers in fee-for-service,” Humana corporate medical director of medical market clinical integration Dr. Kathryn Lueken wrote in the report. “The goal of taking costs out of the system and creating more value for the care received is showing results. Thus, value-based care is achieving the goal of creating higher quality medical care for lower cost.”

For the analysis, Humana looked at about 1.5 million Medicare Advantage members who were cared for by medical care providers paid via value-based models, which tied reimbursement to quality measures and outcomes during 2017. They were compared to about 146,000 “Humana members affiliated with physicians under standard MA settings and to original fee-for-service Medicare,” the insurer said in its report.

In the value-based approach, insurers reimburse providers for services plus additional pay if they meet quality measures, control costs and improve health outcomes of their patients. The traditional fee-for-service system pays for the volume of care delivered and can lead to excess costs and the focus isn’t on getting patients their care in the right place, in the right amount and at the right time.

 

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Chris J. Stewart

Chris currently serves as Chief Operating Officer at Ortho Spine Partners. Prior to that, he was the assistant vice president and business unit leader of Medical Device Management for HealthTrust.

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