(Repeats from earlier Dec 19 with no changes to text)
By Sharon Begley
NEW YORK, Dec 19 (Reuters) - A new U.S. health insurance model uses financial sticks and carrots to steer patients toward the most beneficial care.
The model, known as value-based insurance design, makes patients foot more of the bill for medical procedures of questionable value, like surgery for enlarged prostate and many back operations, and less - even zero - for unquestionably beneficial care such as vaccines and hypertension treatment. But while health policy researchers have been pushing the idea for a decade, it is only now catching on.
*In the largest experiment with financial sticks, Oregon's state employees - about 275,000 workers and dependents - moved in 2010 to a value-based healthcare plan.
"We said you're going to pay more for back surgery, for high-tech imaging, for hip replacement," said Joan Kopowich, administrator of the state Public Employees' Benefit Board. "People got it, and we've seen some pretty dramatic changes."
With employees shouldering an extra $500 for less-effective medical services, she said, MRIs have fallen almost 30 percent and musculo-skeletal procedures such as spinal fusions are down as much as 17 percent. "Spending is dropping like a rock," she said, benefiting employees: Premiums, which had been rising by some 7 percent a year, are now falling 0.5 percent a year.
*In August, when Michigan became the 25th state to expand Medicaid under President Barack Obama's Affordable Care Act (ACA), the legislation required value-based design.
By next July, Michigan Medicaid plans must have co-pays that "encourage use of high-value services, like prescription drugs for high blood pressure, and discourage use of lower-value ones," said Michigan Medicaid Director Stephen Fitton.
His agency has begun to identify the latter with the help of academics and other health-policy experts.
*In South Carolina, the Medicaid program no longer pays for elective inductions of labor or cesarean deliveries prior to 39 weeks of gestational age, which obstetricians advise against.
*Under an Obamacare plan in Maine that uses value-based design, patients will have zero co-pays for many more services than Obamacare requires, said Kevin Lewis, chief executive of Maine Community Health Options. But they will pay more for unnecessary MRIs and other procedures that, studies show, do not improve outcomes.
"We're making this investment because someone has to make the first move toward improving health outcomes," said Lewis. "We're committed to decreasing the total cost of care, and we know the only way to do that is by engaging both providers and patients." (Reporting by Sharon Begley; Editing by Michele Gershberg and Douglas Royalty)