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CareFirst pumps up nonprofit commitment

The Maryland-based insurer, once dead set on going for-profit, now says it's rewarding physicians and launching community-minded initiatives.

By Robert Kazel — Posted Feb. 21, 2005

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Nearly two years after CareFirst BlueCross BlueShield's quest to become a for-profit company was strongly rebuffed by state authorities, the health plan announced it planned to pump $92 million into various long-term initiatives to buttress what it now calls its "not-for-profit mission" -- including new quality incentives for participating physicians.

CareFirst said it had started recruiting physician groups to join the bonus program, which will be part of the Bridges to Excellence organization launched by several large national employers in 2003. The program will pay $50 per year per CareFirst member to medical groups that attain certain performance standards, including development of medical records-keeping systems.

Owings Mills, Md.-based CareFirst will spend $3.6 million on the program between now and 2007, including about $1.2 million this year, said company spokesman Jeff Valentine. The initial pilot phase will include several large primary care physician groups in Maryland, the District of Columbia and northern Virginia, he said.

CareFirst also said will keep down increases in patient premiums by lowering its 2005 operating earnings target by at least $60 million. Furthermore, the company announced it has allotted more than $40 million over the next few years for prescription drug assistance for low-income senior citizens, insurance coverage assistance for difficult-to-insure residents of Washington, D.C., and for improvements in hospital intensive care and the reductions of racial and ethnic health disparities.

The composition of CareFirst's board changed recently, the result of a 2003 state law that required an infusion of new directors to the board as well as an official commitment to remaining nonprofit. T. Michael Preston, executive director of MedChi, the state medical society of Maryland, said he's encouraged by the changes the company is making.

"Overall, it's certainly an encouraging development and reflects we believe the influence of new board members at the company," he said.

"[CareFirst is saying] 'Are we here to pick up money for its own sake or are we here to provide services in an economical and efficient way?' "

The medical society will be observing the trial run of the quality incentive program before it makes any conclusions, though. "We're not making a judgment on adequacy at this point," Preston said. "It will be very interesting and important to see what kind of impact it has."

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