Blue Shield, providers save $37M by coordinating care


By partnering with a hospital chain and doctor group to coordinate care for members of the California Public Employees' Retirement System (CalPERS), Blue Shield of California helped save $37 million for the state program.

Blue Shield of California began coordinating care with the Dignity Health hospital chain (formerly Catholic Healthcare West) and Hill Physicians Medical Group in 2010, dropping costs per member by 1.6 percent to $393 a month in the first year alone, the Los Angeles Times reported.

Most of the $37 million CalPERS saved resulted from shorter hospital stays as the number of inpatient days and hospital readmissions declined 15 percent and the number of hospital stays lasting more than 20 days was cut in half, according to an analysis of the coordinated care program published in the September Health Affairs.

Blue Shield President Paul Markovich credited these cost savings to improved oversight of patients' hospital discharges, including case managers reviewing prescriptions to avoid harmful interactions, calling patients within 48 hours of discharge and booking follow-up doctor appointments within 10 days.

To help prevent Dignity from taking the biggest financial hit within the partnership, Blue Shield and Hill Physicians agreed to send more patients seeking care at an out-of-network hospital to a Dignity facility. "This had to be financially viable for all of us," Markovich told the LA Times.

As a result of the success found from this payer-provider coordinated care program, CalPERS said it will expand the approach to other areas across California.

To learn more:
- read the Health Affairs study
- see the Los Angeles Times article

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