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Ralph de la Torre, MD
President and CEO
Caritas Christi Health System

New England's largest network of community-based hospitals has implemented BlueCross BlueShield of Massachusetts' global capitated reimbursement system. Rather than basing quality measures that determine reimbursement on physicians only (about a third of Caritas Christi physicians are employed), the six-hospital health system dispersed risk so that making it work is everyone's responsibility, relieving docs from taking on all the downside risk.

"As we all remember, the experiment with capitation didn't go so well the first time. That was partly due to the constructs of the system and partly due to technology. BCBSM's new global Alternative Quality Contract (AQC) system also has a quality component. Our organization, which encompasses physicians, hospitals, hospice, imaging—almost a vertical trust—took that payment methodology and dispersed risk, moving it across the system and putting everyone under the responsibility of making it work for patients.

In year one, the hospitals carry the majority of the downside risk. In years two and three, depending on how losses go, there could be some transfer of risk to the physician side as well. On the upside, risk is equitably distributed, based on performance, among the parties—the physicians, the hospital, and the system. We all have ideas on how to fix healthcare, and we need to act on those ideas and bring down healthcare costs. Healthcare is about three parts: access, cost, and quality. Trying to separate any of the three without dealing with them all together is what leads to problems. This is different. It may not be dramatically better right away, but let's find out how we can utilize it for the welfare of our patients, our system, and our doctors. If you approach it like that, it's an opportunity we can't miss."

Philip Betbeze

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