Tuesday, August 4, 2015

Advocates’ guide to underservice recommendations

SIM is seeking to radically transform our state’s $30 billion health system and has chosen a shared savings payment model for those reforms. Advocates are concerned about incentives to deny necessary care under the new payment model, as happened in the past. SIM’s Equity and Access Council was charged with developing protections to limit and prevent underservice. In June, the Council published its 72-page report with 28 recommendations to prevent, monitor and fix underservice in the new system. All but one recommendation reached consensus among the independent consumers, insurers, providers and state agencies on the Council. We’ve published a guide to the recommendations for busy consumer advocates. We expect the report to be opened for public comment soon.

The single controversial underservice recommendation was only opposed by insurers while strongly supported by consumers, providers and at least one state agency. Without this provision, all the savings (both halves) generated by underservice would default to the insurer giving them twice the incentive for underservice. Insurers have several tools to encourage underservice that often result in denials of necessary care, including prior authorization and formularies. Since insurers will know which metrics are being monitored for underservice, but ACOs will not, insurers are potentially both in a position to engineer underservice and to double their profits from it.  The lack of this protection not only undermines the original SIM commitment to deny savings for underservice, it also increases the risk of people being denied necessary care, and reduces badly needed resources to build value in health care – a main SIM goal.