When they can't see the patient for the bottom line


HERE'S WHAT we know so far about how health care fares in a free market. Competition does not reward high quality. Instead, it rewards low cost.

I don't mean to suggest that cost-saving dooms first-rate medical treatment.

Efficiency can serve quality, as long as the medical judgments are truly made in the patient's interest.

But you can't be sure that's always the case. Employers pick health plans based on service and price. They may get assurances of quality from the plans that bid for their business. But there's no proof.

The "What, me worry?" school says employers will migrate toward the better plans because a healthier work force improves the bottom line.

But the bottom-line guys don't necessarily sing that song.

More days lost to sickness may cost less than paying the upfront price of more elaborate care.

You think I'm being too tough? Consider the 6-year-old accreditation program for managed-care plans run by the nonprofit National Committee for Quality Assurance (NCQA). It's considered a floor for what a quality plan should offer.

So far, 18 percent of all health maintenance organizations (HMOs) have received full accreditation, another 17 percent have temporary accreditation of some kind and 4 percent have flunked. Nearly 50 percent haven't bothered to apply.

I asked health-industry analyst Douglas Sherlock, of the Sherlock Co. in Gwynedd, Pa., what difference accreditation makes to an HMO's success. The answer: zip, zero, none.

There's no correlation between a plan's level of accreditation and its profitability or membership growth.

Those with the NCQA's full seal of approval do no better than those without.

If employers don't even insist on accreditation when choosing a health plan for their employees, they're revealing where their priorities lie. Cost first, cost second, cost third -- maybe quality fourth.

There are some exceptional employers who don't behave that way. But most people work for the other kind.

The big question is: What's a good HMO? Right now it's hard to tell.

The HMOs offer up surveys about how happy their patients are. But those surveys are almost entirely self-serving. They don't tell us what we most want to know -- namely, which plans delivers better medical results from their doctors, their hospitals and their particular treatment rules.

What's needed are quality rankings -- like restaurant rankings -- widely distributed to health-care consumers. That would help the market work. For competitive reasons, employers would have to pick more A-plus plans. B-minus plans would have to change or die.

A budding health-care-quality movement hopes to bring such report cards to life. Three main contenders are in the field:

The NCQA, which already collects data on the medical and customer services offered by 40 percent of the plans. Right now, its exhaustive lists of findings don't tell anyone very much. But it's working toward simpler measures that uncover medical results.

The new Medical Outcomes Survey, constructed by John Ware, senior scientist at Boston's New England Medical Center. It evaluates people's general health and, over time, should show which plans do the best for their members.

The new Foundation for Accountability (FACCT), which is developing standards for judging how well HMOs handle specific illnesses.

Believe it or not, most HMOs don't know how well they're actually doing their job -- assuming their job is to make you well rather than get their stock prices up.

The better plans will presumably gather FACCT data. Others will yell that no one should break up the sacred insurer-patient relationship (the relationship used to be doctor-patient, but that was then).

Here's where the government may help. Starting this year, the Health Care Financing Administration (HCFA), which administers Medicare, will require performance data from all HMOs that take Medicare patients.

They'll have to respond to a customer-satisfaction questionnaire, provide NCQA-style data and participate in medical-outcomes surveys.

Next year, HCFA may require FACCT data, too.

But alas, Medicare won't quit doing business with HMOs that show poor results.

"If we did, we might hear from that organization's members of Congress," says Bruce Fried, director of HCFA's managed care. Experience shows that your elected "representatives" might rather you went to a poor HMO than lose campaign contributions from well-paid HMO execs.

There's a larger context to these embryonic measures of quality. You're seeing the start of a massive movement for "patients' rights."

If we get decent quality measures, we can vote with our feet.

Pub Date: 4/07/97

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