Diagnosis-specific pricing helps balance cost of services with effectiveness

When the cost of newer technology is significantly higher than other equally effective approaches, the cost of care can be unnecessarily inflated.

That’s why the Blues are implementing what we call diagnosis-specific pricing. The process helps ensure that the cost of a service is in line with its effectiveness.

It takes into account not only the procedure performed but also the patient’s diagnosis or condition. When a procedure for a particular diagnosis is established according to Blues medical policy, then the fee will be in line with the given procedure. If the procedure performed is considered not medically necessary, then the fee will be in line with an alternative, equally effective and less-costly treatment approach.

Blue Cross Blue Shield of Michigan has already implemented this approach for future proton beam therapy procedures performed in Michigan. Effective Feb. 1, 2015, the Blues will begin applying this diagnosis-specific pricing process for select intensity-modulated radiation therapy procedures.

The specific procedure codes that will be affected for proton beam therapy are *77520, *77522, *77523 and *77525. For intensity-modulated radiation therapy, the procedures codes are *0073T, *77301, *77338, *77418. The established diagnosis fees and not-medically-necessary diagnosis fees for the listed codes will be published on web-DENIS on or before Nov. 1, 2014.

Information on established diagnosis codes will be provided in the near future.