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Lining Up a More Productive Health Care System



Doctors, hospitals and health insurers are aligning goals under value-based care – and it’s working for patients. A podcast with McKinsey & Company explores the challenges and opportunities ahead.

By Allen Karp, Executive Vice President for Healthcare and Transformation Management 

Affordable quality is the destination our health care system is driving to. It’s what patients need – and what doctors, hospitals and health insurers want to deliver. But for too long, it’s been as though health care providers and payers were traveling in different vehicles moving in different directions.

The traditional fee-for-service model, with payments from insurers to doctors based on volume rather than value, created incentives that were not aligned. And significant administrative processes, coupled with a lack of analytic technologies, caused inefficiencies that drove up costs.

But today, doctors and health insurers have at least boarded the same train. At Horizon Blue Cross Blue Shield of New Jersey, we’re moving to a value-based model of care that aligns our goals with those of physicians and health care systems. About 4,500 primary care physicians under our value-based reimbursement system are paid to provide more affordable costs for our members and reach certain quality targets.

Using technology, we’re also able to provide analytic capabilities and data-driven insights to physicians on everything from helping them understand their patients at the population level to identifying cost-effective prescription medications at the point of care to simply scheduling appointments in a patient-friendly way.

On a recent podcast with McKinsey & Company, I explored these trends and others that will have far-reaching impacts on our health care system, including the blurring lines between payers and providers, the importance of focusing on social determinants of health, and how and where care will be delivered.

The journey to affordable quality is far from over. But we’ve already achieved tremendous results through greater collaboration: improved gaps in care, better operational quality measures and significant cost savings.

Check out the podcast for a more in-depth discussion of how we’re delivering more productivity in health care on behalf of our members.

Note: This podcast was released in September 2020, but recorded in January 2020 before the full effects of the COVID-19 pandemic were known. This is why the podcast does not include the pandemic as a topic of discussion.