Monday, October 05, 2009

Harry, Louise, and Global Payment

The health care powers-that-be in Massachusetts want to abolish fee-for-service in favor of what is being called global payment. Global payment is a softer term for what used to be called capitation – a system in which the insurance company pays a provider organization a flat amount per month per subscriber, in return for which the provider is responsible for providing whatever health care the subscriber might need.

Massachusetts Blue Cross Blue Shield has a pilot program going, called Alternative Quality Contract. It is like the old HMO contracts, but with the edges smoothed off with financial incentives for meeting quality goals and other features.

If the idea of global payment is to succeed, the public needs to be prepared for some of its implications. In that connection, the thought occurs to me that it might be useful to air some ads like the Harry and Louise ones that have been given so much credit for scuttling the Clinton health reform effort. Here is what such an ad might look like:

Harry and Louise are in their den. Louise is seated and Harry is bringing her a glass of wine.

Harry: I went to a meeting this afternoon that was put on by the company’s benefits people. They’re offering a new health insurance plan. They call it an Alternative Quality Contract. It’s really a sort of HMO. If we take it, the company will pick up a good piece of what is now being deducted from my paycheck for health insurance.

Louise: We could sure use the money. If we don’t repair that back porch pretty soon it is going to fall right off the house.

Harry: The benefits people say they want to get away from fee-for-service. They say that fee-for-service drives up cost by giving doctors and hospitals an incentive to give us services we don’t really need.

Louise: They are probably right about that.

Harry: The main complication I see is that the contract is with West Side General Hospital and I don’t think Dr. Nichols practices there.

Louise: You mean we would have to change doctors?

Harry: I think so.

Louise: We’ve gotten very comfortable with Dr. Nichols.

Harry: That’s true.

Louise: On the other hand, we had to change doctors when we moved here two years ago and we managed OK. I’m sure they have good doctors at West Side General.

Harry: The benefits people say they made sure of that before deciding to offer the contract.

Louise: Let’s give it a try. If that is the way health care should go, we might as well be part of it.

Harry: Shall I drop by tomorrow and sign up?

Louise: Sure.

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