Aligning Reimbursement and Quality of Care Supports Patient Safety

Contributing experts: Eugene Hsu, MD, and Sai Ma

Protecting the safety of our members while they receive care is one of our most important responsibilities. This is why we design payment arrangements that reward safety efforts and recognize care providers who proactively protect patients from preventable harm.

Our affiliated health plans incurred approximately $1.1 billion in claims in 2023 related to preventable adverse events.¹ Employers who pay medical expenses directly on behalf of their employees shouldered 40% of these costs.²

For example, surgical site infections are among the most common preventable adverse events in inpatient settings. A 2024 analysis focused on surgical site infections found not only increased costs for the original inpatient stay, but increased costs for the entire year following the inpatient stay, at an average of nearly $30,000 additional costs per incident. Patient outcomes were poorer where surgical site infections occurred, and patients’ out-of-pocket costs were higher as well.

A 2024 analysis of health plan claims by Elevance Health researchers highlighted the significant impact of surgical site infections on patients financially and in health outcomes:

$29,414 — weighted average additional cost of an inpatient stay with a surgical site infection
$633 — average additional out-of-pocket cost for patients experiencing a surgical site infection
5 to 7 days — additional average length of stay, varying by procedure type, associated with surgical site infections

Consistent with what has been documented in medical literature, we also found that “never” events — such as wrong-side surgeries — are more common in populations disproportionately impacted by health disparities, including people who are non-native English speakers, which makes it even more important to identify and recognize strong patient safety programs.

While safeguarding patients from harm, it’s imperative to acknowledge and reward the hospitals and facilities within our affiliated health plan networks that provide the highest quality and safest care. By linking hospital reimbursements to widely accepted quality metrics, such as readmission rates, we can collaboratively enhance care standards, reduce costs, and promote patient safety.

Since the early 2000s, value-based care "pay for performance" programs have gained momentum in private and public sectors. Despite widespread adoption, there are persistent challenges and opportunities surrounding the impact of value-based arrangements on patient safety. A recent study found adverse events in nearly 1 in 4 hospital admissions, with about one-fourth of those events considered preventable. There is still more to do, and we are committed to collaborating with our care provider partners to improve patient safety.

Supporting Patient Safety Through Our Quality-In-Sights Incentive Program

Value-based care helps address patient safety by integrating safety measures into contracts and aligning financial incentives with quality performance. For example, our Quality-In-Sights®: Hospital Incentive Program (Q-HIP®) incentivizes hospital performance on more than 20 patient safety measures, including:

Publicly available surgical infection rates.
Condition-specific readmission rates.
Registry-based measures such as operative mortality.
Self-attested measures around maternal safety.

Collectively, these patient safety measures contribute to approximately 80% of the overall Q-HIP score. Each participating hospital receives an annual scorecard, detailing the results for each measure, along with the target levels, enabling hospitals to assess their performance.

Health plan network hospitals in all 14 of our affiliates’ Blue Cross and Blue Shield health plan Commercial markets participate in Q-HIP. This includes 744 participating hospitals that operate under a pay-for-performance arrangement and an additional 214 participants with measure reporting only.³

In 2024, 89% of our Commercial member admissions took place in hospitals involved in the Q-HIP pay-for-performance initiative — with 74% of these participating hospitals receiving financial incentives based on their performance metrics.⁴

These efforts help us collaborate with and support our care provider partners to deliver the best outcomes for the people we both serve. Our affiliated health plans do not penalize participating hospitals. Hospitals striving to meet national benchmarks may still be able to earn scorecard points by improving their performance compared to the prior year.

In one case, such support for a 500-bed tertiary hospital helped them achieve a 50% increase in their Q-HIP scorecard over a three-year period, including improvement in three of six hospital-acquired infection measures within one year. This was a direct result of a hospital-wide initiative to standardize clinical protocols and improve staff education in patient safety.

By sharing best practices and data, and collaborating with other key stakeholders, we're dedicated to fostering truly active partnerships, all with the goal of ensuring patient safety and enhancing the quality of care.

Aligning Reimbursement and Quality of Care Supports Patient Safety

A 2024 analysis of health plan claims by Elevance Health researchers highlighted the significant impact of surgical site infections on patients financially and in health outcomes:

Supporting Patient Safety Through Our Quality-In-Sights Incentive Program

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