Boston Children’s Hospital has become the first children’s hospital in the nation to participate in a pay-for-equity financial payment model.

Blue Cross Blue Shield of Massachusetts (BCBSM) is the first health plan in Massachusetts — and among the nation’s first – to introduce these contracts, which link financial incentives to achieving measurable improvements in health equity.

Boston Children’s has one of the country’s largest pediatric primary care physician organizations, with more than 500 physicians, nurse practitioners, physician assistants, and integrated behavioral health providers. Through its work with Blue Cross, Boston Children’s will focus initially on reducing inequities in child and adolescent well-care visits.

Five of the state’s largest health systems have also signed the agreements: Tufts Medicine, Steward Healthcare Network, Beth Israel Lahey Health, Mass General Brigham and Boston Accountable Care Organization Inc., which is part of Boston Medical Center.

With the addition of Boston Children’s, 56 percent of Blue Cross’ Massachusetts members now receive care from clinicians taking part in equity-focused value-based agreements.

Mark Friedberg, M.D., BCBSM’s senior vice president of performance measurement & improvement, spoke to Healthcare Innovation in January 2023: “At a very high level, every health plan can do what we’ve done; it’s a matter of will more than anything else; and you can start now,” he said. “There are no justifiable excuses for failing to collect self-reported race and ethnicity data from your members, or for using data to approach and address inequities.”

Kedar Mate, M.D., president and CEO of the nonprofit Institute for Healthcare Improvement (IHI), which works with BCBSM on the initiative, told Healthcare Innovation last year that the field of payment in healthcare, which disagrees on a lot of things, “seems to be coalescing around the idea that we could and should pay for more equitable care. If we want to see long-term investment in improving health equity, it can’t be done on grant programs from foundations or government. It has to be done on long-term payment policy that seeks to create lasting and durable financial flows toward specific strategic objectives.”

”Our kids are literally our future and yet we know that racial and ethnic inequities in health care jeopardize that future in so many ways,” said Sarah Iselin, Blue Cross’ president and CEO, in a statement. “We are so fortunate to be working with the experts at Boston Children’s who understand how to close those gaps and address the challenges unique to kids and families with the goal of ensuring that everyone has access to the care and support they need and deserve.”

“Health equity for all families is at the forefront of our goals here at Boston Children’s, so this was a natural move for us,” said Kevin B. Churchwell, M.D., president and CEO of Boston Children’s Hospital, in a statement. “This partnership with Blue Cross marks a significant milestone in eliminating inequities in healthcare, and we look forward to continuing our work together in this space.”




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