Allina, Blue Cross deal ties payments to outcomes, not procedures

[Business Journal, August 27, 2020] In a major shift in how a health insurer pays for medical services, Blue Cross and Blue Shield of Minnesota will start paying Allina Health System for patient outcomes instead of individual medical services.

"It's a big deal," Allina CEO Dr. Penny Wheeler said of the "value-based payment" agreement, announced Thursday. The agreement is expected to impact 130,000 people who have Blue Cross insurance and get care at Allina.

So what does "value-based care" mean? Dr. Craig Samitt, Blue Cross's CEO, used the example of a person with back pain. In a fee-for-service model, a hospital might steer that person towards surgery because that's one of the only solutions that insurance would cover. Under a value-based model, the insurance company would also cover more preventative treatments like acupuncture, which might be all that person needs to keep their pain under control.

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