Health insurer MVP Health Care and Healthfirst, an association of private doctors in Vermont, recently announced an agreement aimed at keeping private doctors in the insurers’ network and rewarding them for providing quality care.
MVP covers 32,000 Vermonters and Healthfirst represents 130 independent physicians in the state.
The announcement comes as the Vermont Managed Care network begins to shutter its operation.
Vermont Managed Care, owned by Fletcher Allen Health Care, negotiated with health insurers on behalf of a large network of hospitals and independent physicians.
Vermont Managed Care ceased new negotiations in January but will continue to manage existing relationships before being fully decommissioned sometime in 2015, said Churchill Hindes, a Fletcher Allen executive.
Hindes and most of Vermont Managed Care’s staff now work for OneCare, a company started by Fletcher Allen Health Care and Dartmouth-Hitchcock Medical Center that serves as an Accountable Care Organization representing all Vermont hospitals.
MVP is participating in a shared savings program with OneCare, but chose not to participate in the program with Vermont’s two other ACOs, one of which was created by Healthfirst to represent its members. The other is Community Health Accountable Care, which represents seven of Vermont’s federally qualified health centers.
A shared-savings program calls for providers in an ACO to meet quality standards for the care of a patient population at an agreed upon cost. If the providers can meet the quality standards for less, they split the savings with the payer.
Blue Cross Blue Shield of Vermont, the state’s largest health insurer, is participating in shared-savings programs with all three Vermont ACOs.
Though MVP and Healthfirst’s agreement allows for some value-based payment, meaning payments are in some way linked to the quality of care, the two chose not to participate in the shared-savings program developed with oversight from the Green Mountain Care Board.
“It would be inaccurate to describe this arrangement as a ‘shared-savings’ agreement,” an MVP spokeswoman said in an emailed statement. “The agreement is constructed to support Healthfirst in managing patient care, which rewards cost savings and extending office hours.”
OneCare does not represent private doctors as Vermont Managed Care did, so to ensure their members would have continued access to physicians in private practices, MVP approached Healthfirst to hammer out an alternative deal, said Dr. Paul Reiss, Healthfirst’s director.
MVP could have negotiated with individual practices, but the practices might have been reluctant to mint their own agreements, because they would have less leverage to negotiate on their own, Reiss said.
Healthfirst was created in part to help Vermont’s independent physicians negotiate better rates with the payers in the health care system.
The agreement is the first time Healthfirst has successfully negotiated payments outside of a program overseen by state regulators.
Private doctors generally receive lower reimbursements even when providing the same services as hospitals and hospital-employed physicians, making it difficult for them to stay in business.
There are some requirements, such as keeping extended office hours, that aren’t in the ACO shared-savings agreements, Reiss said.
“The office may close at five but we may continue to see patients until six to see all the people that need to be seen,” Reiss said, which isn’t as simple for hospital-employed doctors.
If patients can get in to see their doctor, they’re less likely to seek treatment in emergency rooms, which will save the patient and the insurer money, Reiss said.
