What Happens When Physicians Know the Total Cost of Care

By Jacqueline Fellows
HealthLeaders Media
May 28, 2015

“As a primary care provider, we refer patients [to other providers] all the time, and we have no idea what cost is like,” says Kranz. “Now that we are finally getting numbers, conversations are starting among physicians. They’re asking, ‘Are we doing the right thing?’ “

Measuring Total Cost of Care

NRHI embarked on its pilot project to report on the cost of care in 2013 with a $1.4 million grant from the Robert Wood Johnson Foundation and five RHICs. In addition to Q Corp., the other four RHICs are Maine Health Management Coalition, Midwest Health Initiative in St. Louis, Minnesota Community Measurement, and the Center for Improving Value in Health Care in Colorado.

Though the cost of care pilot program began prior to RWJF’s ambitious initiative to build a culture of health, Tara Oakman, senior program officer at RWJF says giving healthcare providers better and more transparent access to the cost of the care they are providing fits into the framework of the organization’s broader goal.

“We want information to be useful at multiple levels: for consumers, provides, payers, and communities,” she says.

The pilot just received another $1.9 million from RWJF for an additional 18 months, and Mitchell says it will expand the project to include three additional RHICs that haven’t yet been named.

The method NRHI uses to calculate the cost of care at sites that are part of the participating RHICS is called Total Cost of Care (TCOC). It was developed by HealthPartners, the integrated health system in Bloomington, Minnesota, that includes seven hospitals, dozens of primary care clinics and urgent care centers, and a health plan. The TCOC was endorsed by the National Quality Forum as a validated measure of healthcare affordability in 2012.

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(MHMC mentioned on pg. 2)