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September 2009 St@teside

SCI Hosts Meeting on Value-Based Purchasing in State Health Plans

In early September, the State Coverage Initiatives (SCI) team hosted a meeting with the Tennessee Benefits Administration on ways to incentivize healthy behaviors and improve value-based purchasing in the state’s public employee health benefit plans (PEHBP).  The meeting was developed in response to a request for technical assistance from the Benefits Administration, which is currently working on a new RFP for their PEHBP.  Also in attendance at the meeting were PEHB experts from Alabama, Massachusetts, Minnesota, North Carolina, and West Virginia.

Tennessee Benefits Administration staff is focused on preserving the excellent benefits that members of the three Tennessee public sector plans now have, despite the dramatic increase in costs incurred by the state during the last five years. Similar to nearly every other state, Tennessee faces the challenge of an excessive disease burden in the public sector plans.  In response to this key cost driver, some states have responded with concerted initiatives to incent consumer and provider behavior that promotes improved health. 

The meeting addressed measures that the state could implement to address both consumer and provider behavior. With respect to consumer-focused strategies, the group discussed:

  • creating incentives for members to complete a health risk assessment (or biometric screening) or to maintain a healthy weight,
  • which mechanisms work best to make these incentives effective (reduced deductibles, reduced premiums, cash payments, etc.), and
  • the manner in which these incentives can best be communicated to members. 
In terms of provider behavior, the discussion focused on ways to encourage providers to offer a better standard of care through payment policies.  Topics included various pay for performance strategies, including what behavior should be the focus and which providers are best to include.  A strategy under discussion that focused on both providers and consumers was provider tiering.

We anticipate that the topics discussed during the meeting will continue to be of great interest to those involved in state health plans.  SCI is currently involved in research that will delve more deeply into these issues.  Stay tuned for more information!