Tell us what you really think: CA providers pick the best and worst HMOs
Public release of results prompts controversy
Americans love to anoint clear-cut winners and losers, whether voting for "most likely to succeed" in high school or reading Fortune's annual list of the top 500 companies or Forbes' compilation of the world's richest people. The recently released HMO rankings by the Pacific Business Group on Health (PBGH), an influential health care purchasing consortium of employers, provide one more indication that managed care has prompted a similar motive to showcase the best and brightest in the industry.
The twist on PBGH's survey: Physician practice administrators, not consumers, are the ones doing the judging. And managed care companies, used to ranking physician practices and even individual physicians they contract with through medical outcomes and patient satisfaction measures, are finding that the shoe is on the other foot in this case - especially because the findings are being released publicly.
Managed care organizations and physician practices can expect this trend to spread to other states. Ann Castles, project manager for the PBGH survey, says she has had numerous inquiries from business groups in other states about the survey and how it was conducted. Although the survey is in its third year, this year marked the first time results were released publicly.
More significantly, the employer coalition used the survey results as a bargaining chip during its rate renegotiations with payers. The average premium increase among payers the coalition negotiates with is 8.1% effective January 1999, although a big chunk of that includes a rate hike by Kaiser Permanente. Separate from Kaiser, the rate hike trend is 3.8% among payers with whom the group contracts. PBGH says this rate trend is favorable compared to nationwide premium trends of around 10%.
The PBGH survey of top administrators at 71 California group practices generally gave PacifiCare and Health Net high rankings, and Aetna US Healthcare and Blue Cross of California poor rankings. Also included in the survey were CIGNA, FHP, Foundation, and Prudential (although FHP and Foundation have since been merged into other MCOs, they were surveyed as a separate entity because they maintained separate operations in 1997). Kaiser Permanente was not included in the survey because Kaiser members are treated by a single medical group closely affiliated with the HMO.
Provider reaction has been mixed. An executive with Blue Cross of California told the Los Angeles Times that he considered the survey "a work in progress" and that it reflected opinions of the respondents rather than facts.
PacifiCare, which fared better in the survey, is delighted with its high ranking in the survey but would have liked its absolute scores to have been higher, says Gordon Norman, MD, vice president and plan medical director.
"I think if the chief medical directors [rather than administrative officers] had been interviewed, the response would have been different," Norman says.
PacifiCare plans to delve into some areas the PBGH survey raised concerns about - such as ease of specialty referrals and quality improvement - through its own internal surveys to providers and members, Norman says.
Overall, PacifiCare applauds the idea of employer groups surveying providers, he adds. "The process of plans competing in a marketplace to improve care and service to members and providers via feedback and steerage is exactly the way to refine the marketplace of medicine. This cannot be done by heavy-handed legislation of regulating care body part by body part."
Physician administrators participating in the PBGH survey ranked each plan based on the following categories:
· customer service;
· quality improvement;
· data reporting;
· formulary management (many California groups are at-risk for pharmacy costs, and as a result have a large stake in how formularies are managed);
· specialty referral programs;
· financial incentives and contracting relationships;
· utilization management;
· operational aspects of plan mergers.
"The main thing we learned is that there is still lots of room for improvement on the part of HMOs," Castles says. "On the average, there does not appear to be much collaborative work going on. And in the California marketplace, where more and more of the traditional HMO roles such as quality oversight and financial administration are being delegated to providers, it is imperative that physician groups and HMOs work together on a collaborative basis to make sure patients receive quality care."
On the positive side, the PBGH survey found that California HMOs are doing a better job of data reporting, Castles says. HMOs are improving in their efforts to provide eligibility data on a patient to a provider and in communicating their own data measurement results.
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