Design Element 5: Engagement, Selection and Payment of Health Care Providers

1. Design Element 5: Engagement, Selection and Payment of Health Care Providers Africa Health Insurance Workshop - Extending Health Insurance: How to Make It Work

2. Objectives By the end of this session, participants will be able to: • Relate goals of scheme to selection and payment of providers; • Understand how to lay the groundwork for selecting and engaging health care providers; • Understand the key factors in the design of rational payment systems; • Identify key aspects to strengthening service delivery to assure good quality and efficient health care provision.

3. Align Goals with Selection and Payment of Providers • Payment systems create incentives for providers (and patients) • Align health insurance policy goals with choices of providers and payment methods • Policy goals may include • Access, quality, cost containment, preventive vs curative care, simplicity, prevention of fraudulent behavior etc.

4. Know Your Market • Understand the supply of health care providers • Provider type, number and location relative to target population and benefit package • Health insurance schemes require adequate provider networks • HI schemes can promote but usually cannot create the desired mix and numbers of providers • Map providers to service areas (GIS helps – see slide) • Types of provider • Organizational structure • Location • Ownership structure • Quality/reputation (if possible)

5. Health Facilities in Marib Governorate, Yemen

6. Know Your Market (2) • Compare mapping to goals, benefits, target populations • Make adjustments as necessary • Either in goals, benefits, target populations or in pre-requisites to implementing scheme to create adequate network • Bonus: mapping helps in your negotiations with insurance companies etc., to ensure they contract with adequate provider network • Illustration • Kyrgyzstan

7. Provider Choice • Choice of providers is often important to beneficiaries • Must be balanced with health insurance goals and realities • Types of choices: • Public vs. private • Choice among similar specialties • Generalists vs. specialists (gatekeepers?) • Physicians Vs. other health care workers • Types of hospitals (clinics, secondary, tertiary, ER) • In network vs. out-of-network (often not option in developing countries) • Impacts (tradeoffs) of decisions on provider choice • Beneficiary satisfaction • Cost and efficiency • Provider income • Quality/appropriateness of care

8. Quality of Care • Provider contracting and payments are not primary determinant of quality, but can have a significant impact • Cross element point: Health insurance is not a panacea for what ails a health care system

9. Payment and contracting can affect quality • Ways that selection, contracting and payments can affect quality • Require accreditation • Align physician and hospital incentives with appropriate care • Balance of PHC and specialist professionals in network • Beneficiary complaint resolution process • Financial incentive for appropriate number, type and location of care • Compliance with clinical guidelines • Example; Clinical care pathways (CCP) for hospital payments • Require participation in quality assurance program • Termination from network and other penalties

10. Footer Discussion Topic • Challenge • You are charged with design and implementation of a new health Insurance pilot in one or two districts in your country • Districts must contain an urban area but have significant rural population • Target population is below and just above poverty line • Benefit package will cover both PHC and acute care • Question • How do you determine the adequacy of the provider network in districts to help you choose pilot sites • Format • Discuss in your groups for 10 minutes • You do not have to reach consensus • I will ask for volunteers to give their ideas.

11. Footer Provider Payment Methods • Physicians • Fee-for-service • Salary • Capitation • Geographic variations and other methods • Hospitals • Fee-for-service • Line item budgets • Case-based payments • Per-diem • Global budget • Performance-based payments (P4P) • Many variations on each (and this list is not exhaustive) • Can get extremely complex • Politics and influence will always play a part

12. Footer Provider Payment Methods Explained • Fee-for-service • Payment is made for each service provided • Many variations on FFS payment methodology • Salary • Fixed amount per month/year • Common for public health sector or group models and managed care • Can have many variations • Capitation • Fix amount per member (or sometime group) per month/year for specified basket of services • Most common for PHC

13. Footer Provider Payment Methods Explained • Line-item budget (hospitals and clinics) • Based on inputs (number of beds, physicians, health workers, buildings etc.), rather than outputs (e.g., services provided) • Common in former socialist countries and public facilities • Can be adjusted to take some measures of output into account • Per-diem (hospitals) • Fix payment for each day patient is in hospital (per bed-day) • Can be case-mix adjusted and have limits by diagnosis • Case-based payment (hospitals) • Fixed payment for a case based on diagnosis (or variation) • Many types have been developed (e.g. diagnostic-related groups), • Adjustments for outliers, hospital case-mix • Complex to implement • Data requirements, coding, training, groupers, upcoding

14. Footer Provider Payment Methods Explained • Global Budget • Fixed maximum expenditure for basket of services • Can be based on factors such as: Health care needs; objective target (e.g., % GDP) etc. • Budgets usually set by governments (e.g. Canada single payer, German point system) • Enforcement is issue • Performance-based payments (P4P or value-based purchasing) • Links payments to pre-determined result or output • Can link to positive results or decreasing negative results (e.g., medical errors) • Questions from providers on appropriateness of quality measures

15. Footer Operational and Institutional Constraints • Provider selection systems can range from simple to very complex • More complex strategies have tried to align various policy goals and incentives • Need to carefully consider • Data and information available to support various payment methods • Regulations and requirements (e.g., use of ICD-10 codes) • Information technology available: groupers, HMIS; Automation available at hospitals, clinics group practices • Human resource capacity • Training requirements

16. Footer Provider Contracts • Provider contracts must: • Conform to legal and regulatory requirements of the jurisdiction • Cover essential elements clearly: • Covered services • Payment rate and terms • Dispute resolution • Performance incentives; • Indemnification and liabilities • Administrative procedures (forms, billings) • Both parties’ rights

17. Footer Exercise • Determine the incentives in each provider payment system • Use table on following slide • No single right answer because each payment system has many variations that can effect incentives • Each team assigned one payment method • Ten minutes and then report from each group

18. Evaluation of Provider Payment Schemes

19. Footer Provider Payment Methods: Optional Exercise • Scenario • Your country has decided to implement capitation for primary health care (both individuals and group practices) as part of it social health insurance scheme. • Challenge • Design capitation payment system that meets health insurance goals (increase use of PHC, reduce use of specialist, promote quality and efficiency etc.) • Tasks: respond to following questions • What should be the basis for the capitation payments • How much choice of PHC providers should member have • What should be maximum and minimum enrollment per provider • How to reduce incentives to over-refer to specialist to increase income • How to achieve best utilization o PHC services

20. Thank you