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In Calif., Bonuses Based on Quality, Not Cost Savings

Blue Cross of California has decided to move away from the traditional managed care incentive of rewarding physicians for controlling medical costs, and instead will implement a program in which physicians receive bonuses for quality of care and patient satisfaction.

The shift of Blue Cross, one of the nation's largest health plans, toward rewarding quality over cost-cutting may have resulted from feedback from consumers and physicians. Surveys indicate that physicians are more satisfied, professionally, and more appreciated by their patients when bonuses are based on patient satisfaction and exceptional clinical performance. Under the new plan, physicians will not have an incentive to refrain from referring a patient to a specialist or a hospital.

The plan is based on measurable criteria. Blue Cross will conduct patient surveys and interview members who switch doctors to determine why. How quickly a physician responds to a patient's complaint, how often a physician performs certain preventive health services, such as cancer screenings, and how they manage chronic diseases, such as asthma or hypertension, feed into a point system; practitioners with more points receive greater bonuses.

HMOs have offered quality-of-care bonuses, but studies show that they generally are small compared to what physicians receive for implementing cost-cutting measures. Now, physician groups can receive a bonus that equals as much as 10 percent of their quarterly medical care payments for emphasizing prompt referrals and preventive treatment.

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