New Partners HealthCare, Tufts Health Plan pact lowers Partners’ reimbursements

By Robert Weisman, Globe Staff

Partners HealthCare System Inc., the state’s largest hospital and physicians organization, this afternoon said it has torn up the last two years of its contract with insurer Tufts Health Plan, replacing it with a new four-year pact that will lower Partners’ reimbursements by more than $105 million from what they would have been under the former rate structure.

The agreement with Tufts, based in Watertown, covers payments to all Partners doctors groups and hospitals, including the Harvard-affiliated Massachusetts General and Brigham and Women’s hospitals in Boston. It follows a similar agreement Partners reached last October with the state’s biggest health insurer, Blue Cross Blue Shield of Massachusetts.

As with the Blue Cross deal, the new Tufts contract requires Partners medical care providers to accept so-called global payments. Those payments force the providers to take on risk by giving them budgets for patients’ care rather than allowing them to bill for individual patient visits, tests, and procedures.

Payment increases over the four-year period of the new Tufts contract will be 2 to 3 percent, roughly half of what they would have been during the last two years of the current Partners contract with Tufts.

The goal is to contain health care costs, which have been rising by double digits annually for much of the past decade. Combined with the new Blue Cross pact, Partners said, the deal with Tufts will contribute to a total of $345 million in savings compared with what the health care provider would otherwise have been reimbursed over the next four years.

With the new Partners pact, Tufts said about 70 percent of its health maintenance organization members are now covered by risk-based contracts.

Partners is still negotiating a new contract with another major Massachusetts health insurer, Harvard Pilgrim Health Care, based in Wellesley.