Lack of motivation of private payers to incentivize EHRs

Posted on July 5, 2011 I Written By

Dr. West is an endocrinologist in private practice in Washington, DC. He completed fellowship training in Endocrinology and Metabolism at the Johns Hopkins University School of Medicine. Dr. West opened The Washington Endocrine Clinic, PLLC in 2009. He can be contacted at doctorwestindc@gmail.com.

In his June 30, 2011 post “Private Payers Need to Join Humana, CMS With EHR Subsidies”, Neil Versel wonders where all the private payers are when it comes to providing incentives to doctors for implementing meaningful use of EHRs.  Apparently, Humana is now one company slated to start following CMS’ lead.

This reminded me of an interesting story involving an insider I knew who previously worked for insurance companies.  He once told me an interesting story about the conversations that happen behind closed doors of private health insurance corporate boardrooms.  Alas, it was so long ago, that I honestly don’t remember who it was, or who they previosuly worked for, but it put such an indelible mark on my memory that I couldn’t resist the chance to share it here.  This may be a bit graphic to some, so turn back now if you have a faint heart.

I told my contact that I just couldn’t understand why preventive office visits such as counseling by registered dieticians dealing with weight loss for patients with obesity weren’t ever covered.   Did these patients really need to develop diabetes first before any coverage for such services would be provided by the insurance companies? It just didn’t make any sense to me or others that I had discussed it with.

My contact told me about an example of how insurance companies employ actuaries to mathematically predict odds of a bad outcome.  [For those of you who worship the movie Fight Club, you might find some similarity here to a particular dialog in that film.]  Because the odds are very good that a particular patient will change insurance companies within a few years –happens all the time — there is much less of a chance that insurance company A will have to end up paying for their leg amputation by the time it happens.   Therefore, insurance company A doesn’t provide much in the way of preventive care and counseling visits today.   The odds are with the insurance company that they’ll never have to pay for that operation in the future because the patient’s out the door by then and on to insurance company B.  I know, what a callous and disgustingly money-grubbing view!  Gee, you don’t say.

Now, getting back to this private insurance company incentive plan idea …

Dr. West is an endocrinologist in private practice in Washington, DC.  He completed fellowship training in Endocrinology and Metabolism at the Johns Hopkins University School of Medicine. Dr. West opened The Washington Endocrine Clinic, PLLC, as a solo practice in 2009.  He can be reached at doctorwestindc@gmail.com.