Expert: Payment reform biggest issue for health care

LOVELAND – The advent of payment reform for health-care providers will prove to be the industry’s biggest obstacle in the coming years, according to Scott Gottlieb, a resident fellow at the American Enterprise Institute.

Gottlieb gave the keynote speech and participated in a panel during the Fort Collins Area Chamber of Commerce’s Health Care in Your Future Summit, held Wednesday at the Embassy Suites in Loveland.

Considered a leading expert in health policy, Gottlieb warned the crowd at the event that the switch from a fee-for-service model to a pay-for-performance model, while inevitable and viewed by many as positive, will cause burnout among doctors and place risk on providers.

This switch represents a change in health care from the old model, in which providers were paid for services rendered to patients, to a new model in which providers are paid based on their patients health outcomes.

There are a number of initiatives being tested across the country to find a way to implement this new system of payment, but the change is coming, one way or another, according to Gottlieb.

Under new rules mandated by the Patient Protection and Affordable Care Act, there is no economic incentive to try to remain under the fee-for-service model, Gottlieb said.

Conference panelist Shalini Wittstruck, of Anthem Blue Cross and Blue Shield, echoed that sentiment.

“There’s a major transition from an episodic to a value-based system,” Wittstruck said, adding that about 40 percent of Anthem’s providers are using a pay-for-performance model.

In addition to payment reform, other obstacles in health care include the incorporation of new technologies such as electronic health records and dealing with larger populations needing treatment as Medicaid reform adds tens of thousands to the rolls of covered lives.

The changing face of health care has led to a trend of many physicians and practices joining up with large health care systems, like University of Colorado Health and Banner Health to better weather the storm.

“The seas of health care are rough waters ahead,´ said Rick Sutton, CEO of Banner Health in Northern Colorado. “It’s better to be on a battleship going into rough seas than on your own cabin cruiser.”

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Molly Armbrister covers real estate, banking and health care for the Northern Colorado Business Report. She can be reached at 970-232-3139, or

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