UnitedHealth Will Tie Doctors’ Payments to Quality of Care

By Sarah Frier and Drew Armstrong

Feb. 9 (Bloomberg) -- UnitedHealth Group Inc., the largest U.S. health insurer by sales, will pay doctors based on the quality of their care in a cost-cutting effort that also benefits the company’s consulting business.

UnitedHealth expects to save twice as much as it would spend on incentive payments for doctors because patients will be healthier, according to company documents forwarded by spokeswoman Cheryl Randolph. The program may cover as much as 70 percent of the insurer’s commercial members by 2015, from less than 2 percent now, the company said.

The nationwide expansion of the program follows similar efforts by the U.S. government and rival insurers to trim medical costs by shifting away from paying based on the amount of services provided. Optum, UnitedHealth’s services business, will be able to sell software, data and consulting to providers making the changes, Sam Ho, chief clinical officer of the insurer’s UnitedHealthcare unit, said in an interview.

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