BCBS Massachusetts signs value-based contracts with equity measures

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Blue Cross Blue Shield of Massachusetts touts itself as the first in the state and one of the first in the country to develop a financial payment model that rewards health systems and physicians for eliminating racial and ethnic inequalities in care.

Four of the state’s largest health systems have signed the agreements, which link financial incentives to improvements in health equity. These include the Steward Healthcare Network, Beth Israel Lahey Health (BILH), Mass General Brigham and the Boston Accountable Care Organization (BACO), which is part of Boston Medical Center.

Together, these systems serve more than 550,000 Blue Cross members.


The new contracts will initially focus on measuring and rewarding equity in care in several clinical areas where inequalities have been identified, including colorectal cancer screening, blood pressure control and diabetes care. More categories will be added as the payment model evolves.

The Center for Healthcare Organization and Innovation Research (CHOIR) at the UC Berkeley School of Public Health will conduct an independent external evaluation of Blue Cross’s efforts to advance healthcare equity, using qualitative and quantitative methods to assess the impact of the initiative investigate and publish.

“We believe that almost all clinicians already want to reduce racial and ethnic disparities in care,” said Dr. Mark Friedberg, Senior Vice President, Performance Measurement & Improvement at Blue Cross. “By incorporating equity measures into our compensation models, we intend to create an explicit business case for large healthcare systems to increase their investment in developing, expanding and sustaining programs that deliver measurable equity improvements.”

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Friedberg said Blue Cross encourages and supports participating organizations to extend their equity improvement initiatives to all of their patients — including those whose healthcare plans have not yet introduced financial incentives related to healthcare equity.


This isn’t the first time BCBS Massachusetts has turned its focus to stocks. In May, the insurer launched a Health Equity Business Accelerator, a program designed to provide financial, strategic and mentoring support to founders of people of color to address differences in the direction of venture capital funding.

According to Blue Cross, the program will focus on “creating equitable health services and solutions.”

Accelerator participation includes a $150,000 investment and nine months of customized programs delivered in collaboration with partners such as Capital Network and Healthbox to accelerate growth and foster innovation.

Blue Cross Blue Shield Massachusetts signaled its focus on justice in 2021 when it made a number of investments including: a grant program to support non-profit organizations led by Black, Indigenous and Other Colored People (BIPOC); a first-to-market approach to collecting racial and ethnicity data to address inequalities in member care; Expanding marketing efforts to better reach more diverse audiences with messages focused on closing unmet needs and improving overall health; and new investment and support for minority-owned companies.

These efforts were made possible by $350,000 Racial Equity and Justice Grants, which support BIPOC-led nonprofits focused on addressing racial injustices in Massachusetts communities.


“For more than a decade, we have partnered with physicians and hospitals through our alternative quality contract, which replaces the fee-for-service model and instead rewards clinicians’ efforts to improve the quality and value of the care they provide,” he told Andrew Dreyfus, CEO of Blue Cross. “We are now building on this model to help healthcare systems improve equity in our value-based compensation programs. As a health plan, this is the most important tool we have to work toward a health system that provides affordable, quality, and equitable care to all of our members.”

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