Care Provider Incentive Could Slash Medicaid Costs

(KCPW News) A Utah House Republican wants to cut down on Medicaid costs by giving health care providers an incentive to send patients to another provider if it’s less expensive. Representative Dean Sanpei says federal health reform will force the state to change Medicaid eligibility requirements, which will greatly increase the number of eligible residents. He says one major problem is that more expensive providers, like emergency rooms, have an incentive to care for patients who could be seen somewhere else, like an urgent care center, at a lower cost.

“Now not everybody can go to an urgent care,” he says, “but 30 to 40 percent of individuals who are in an emergency room could be seen in urgent care for simple ear infections or simple broken bones, which is a much lower cost setting.”

That’s why Representative Sanpei says the system should move away from fee-for-service and towards bundling reimbursements for services that are provided.

“If we reimburse regardless of where they go for care, the greatest incentive from a profit perspective, would be to get as many individuals as you can who are appropriate to be seen in a physicians office, which is the lowest cost setting, to get them there.” Sanpei says.  

 The lawmaker is an Assistant Vice President for Intermountain Healthcare.