Wellness Health Incentive Payment Program

Maricopa County, AZ

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Sustainable healthcare should always involve a responsible partnership between the payor and the healthcare administrative vendor or third party administrator whose paid administrative fees can increase or decrease dependent upon performance measured against nationally recognized health and wellness performance standards. The Wellness Health Incentive Payment (WHIP) Program can hold healthcare administrative vendors accountable for wellness activity and ultimately for facilitating positive health/wellness outcomes, as well as penalize or reward healthcare administrative vendors according to the vendor’s performance as measured against nationally recognized standards.

Maricopa County, Arizona, by population, is the fourth largest county in the United States and provides healthcare to approximately 30,000 people through Maricopa County’s self-insured $144 million Employee Health Initiatives Department and Trust Fund. In this innovation, the primary healthcare vendor reimbursement emphasis has been for the payor to reimburse the third party administrator or healthcare administrative vendor solely for medical claims and administrative services with a modest emphasis placed upon reimbursement for annual health and wellness performance and progress towards achieving specific disease prevention milestones in the following areas:

• Mammography Screenings
• Well Adult Screenings
• Well Child Screenings
• Colorectal Cancer Screenings
• Well Child Immunizations

The Maricopa County Employee Health Initiatives, Employee Health Care Request for Proposal (RFP) and subsequent healthcare administrative vendor contract with CIGNA Health Care, Inc, specifies that the healthcare vendor must actively “partner” with Maricopa County and propose fee specific health wellness and other performance guarantees and incentives. Prior to subsequent contract renewal and each year thereafter, these guarantees are negotiated with the contract overseer, Maricopa County’s Employee Health Initiatives Department, until the contract is otherwise concluded.

The minimum health and wellness performance standards are based on the national Health Employer Data Information Standards (HEDIS) for specific health and wellness disease preventive activity or an agreed upon higher metric standard.

Immediately following the implementation of the WHIP and measurement of the first year results, the payor and the vendors should shift their focus immediately to negotiating “stretch goals” for the next contractual evaluation period. Payors will need to determine and prioritize how much of their budget will be invested and allocated to the payment of vendor incentives in the event that the vendor exceeds the performance standards. The payor and the vendor must be patient and commit to a vision of continuous long-term improvements in both increased screenings and increased disease prevention activities as well as improving health outcomes and avoiding short term and long term medical costs.

As a result of the WHIP Program and other factors, Maricopa County has been consistently developing a culture of health awareness and high employee health benefit satisfaction. Costs have increased at a significantly lower rate than the national average.

Massachusetts state and local governments and other private and public payors fund and provide healthcare to populations where the health status outcomes and the cost of care would benefit significantly if the healthcare administrative vendor and their agents are financially encouraged to periodically and systematically evaluate individuals for indicators of the early stages of disease and also take timely preventive measures to prevent disease so that all children and adults live well into the future.

Payors and vendors will need to diligently evaluate the economic values of each of their discrete performance guarantees and performance incentives based on past vendor performance, the demographic needs and the health risks of the payor’s respective population, and/or in what specific health and wellness activity areas the vendor needs more positive or negative reinforcement in contrast to a “straight line” performance guarantee/performance incentive strategy or “scheme” wherein each performance guarantee or performance incentive is always “valued” or “weighted” equally. At any given point in time in any population, one should not assume that all wellness activity performance guarantees should be weighted equally.

The WHIP Program alone will not guarantee that all populations served by the payor and the healthcare vendor will live well into the future. WHIP should be viewed as one instrument in a comprehensive Health Care Reform “tool box” that creates a socially responsible yet financially focused wellness payor/ vendor partnership to improve health outcomes, prevent disease, and reduce medical costs.

Payors must be willing to identify, procure and monitor progressive-minded vendor organizations that are willing to be a “true” wellness partner and not select vendors that are conspicuously risk averse in regards to the receipt of the vendor’s reimbursement fees for both health screenings and administrative activities regardless of how the vendor performs in comparison to the minimum performance guarantees or the incentive earning level of performance. Payor and vendors must be patient and mutually commit to a path of continuous long term improvement in both health/wellness and administrative performance activity areas.

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