Covered CA Takes on Delivery System Reform

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Covered California’s Board of Directors recently announced key changes to its contracts with insurers that are designed to reform the delivery of health care by improving quality and lowering costs.  The five key building blocks of the changes include:

  • Strengthening value-based, patient-centered benefit design to improve primary care access
  • Requiring providers to meet quality standards without exception
  • Adopting payment strategies that support quality performance
  • Adopting proven models of primary care and integrated delivery
  • Providing consumers tools they can use to make informed provider selection choices

Based on these building blocks, Covered California made significant changes to the insurer contracts.  Some of these changes will require insurers to:

  • Identify poorly performing providers and hospitals on various quality metrics or cost considerations.  They must exclude poorly performing providers or hospitals from their networks by 2019 or document the reasons for their continued participation.
  • Reduce or increase reimbursement amounts to hospitals by up to 6 percent depending on whether certain quality standards are not met or are exceeded.  Changes will be implemented over a seven year period.
  • Reduce health disparities by tracking, trending and improving quality measures for patients with diabetes, hypertension, asthma and depression.
  • Assign a primary care clinician to enrollees within 30 days of the coverage date, regardless of plan type.
  • Describe their plan for implementing Accountable Care Organizations (ACOs) or Integrated Health Models (IHMs).  In 2017, they must report: (1) the percentage of Covered California and total enrollees receiving care through ACOs or IHMs and (2) how the models ensure accountability for quality care and lower costs.

The first phase of Affordable Care Act implementation saw Covered California focused on expanding coverage and reducing the number of uninsured.  Now it has taken bold steps to move into the second phase – reforming the delivery of health care in California.