In what's being touted as an unprecedented effort, doctors and hospitals in California will be rewarded with bonuses of at least 5 percent for quality under a common set of standards adopted by six HMOs.The six, Aetna U.S. Healthcare, Blue Cross of California, Blue Shield of California, Cigna, Health Net, and PacifiCare, are engaged in an effort to prevent medical errors.

The Los Angeles Times reports that the scheme is the latest in a string of innovative methods that plans and employers are using to shift the focus from costs to quality. For instance, New York-based employees of IBM, Xerox, PepsiCo, and Verizon will have access to a Web site that ranks local hospitals based on quality and performance measures.

As with the California initiative, the companies would provide bonuses to hospitals that meet performance standards.

"We think that 20 to 30 percent of health care costs can be reduced by minimizing mistakes and doing the procedure right the first time," Bruce Taylor, director of benefits planning for Verizon, told the newspaper.

Many large purchasers believe that focusing more on quality than only cost-containment will ultimately reduce costs, and works well in conjunction with strategies to transfer more health care expense — as well as control and responsibility — to employees.

"Tomorrow, employers will look to consumers to be the drivers of the health care system by giving them the quality information and the financial incentives they need to make better choices," Peter Lee, president and chief executive of the Pacific Business Group on Health, told the Times.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.