Lola Butcher

Health plans and employers are convinced that improving quality will save money. This time, they think they've got the data.

Lola Butcher

Two years after launching an ambitious effort designed to transform the health care marketplace, some of the nation's biggest employers are focused like a laser beam on a big number.

They assembling a group of employers and health plans that together have claims data for between 15-20 million individuals. In 2006, that information will be used to build the mother of all health care data sets and to produce definitive measures of the quality and efficiency of health care provided by physicians and hospitals.

"No single employer and no insurance company has enough data to do that reliably and consistently," says Sheila Sweeney, vice president for benefits for Assurant. "So we've got to aggregate the data — and it's a massive undertaking."

In seeking to create a critical mass of claims data, Care Focused Purchasing, as the group is called, is winning the support of the managed care industry. Aetna and Empire Blue Cross Blue Shield sit on the CFP governance committee. Aetna Senior Vice President Jim Foreman says the benefit of participating in CFP outweighs the technical challenges of sharing claims data.

"We get access to more data in the marketplace that goes above and beyond our own data," he says. "And that's very important."

Regence, Cigna, Humana and a few others are on board with the CFP effort, and many more are in the process of signing up.

"We're probably going to actually get somewhere this time because of the amount of energy around this," says Joe Woods, director of innovative customer solutions at Humana. "These companies are able to move a market because they have such buying power." Bob Ihrie, vice president for compensation and benefits at Lowe's Companies, says CFP represents a "tremendous opportunity" to rein in steadily rising health care costs.

Jump that obstacle

"But none have enough data to measure performance with precision across the majority of all providers," says Ihrie. "If employers partner with health plans to jump this obstacle, we're in a position to capture big gains in quality improvement and cost reduction."

Lowe's and Assurant are 2 of about 30 employers that launched CFP in 2004. CFP seeks to do two things: establish a set of performance measures that become the national standard and aggregate enough data to allow those measures to be used with a high degree of credibility, says Eric Grossman, a consultant at Mercer.

Data aggregation will start as soon as enough employers and health plans sign on. Grossman says CFP will not veer from its focus on quality and efficiency. It will not confuse efficiency with cost. In fact, CFP will not collect financial information about claims, but rather utilization data.

"This is not an effort to identify and steer care toward cheap docs and cheap hospitals," says Grossman. "The fact that you may charge $200 for an office visit and I may charge $175 — that's not what we're measuring." Rather, CFP defines efficiency as total resource consumption for the best health outcome.

Even though all health plans that participate will have the same quality and efficiency information, Foreman, at Aetna, says health plans are likely to use the information in different ways.

"We'll see derivatives on the high-performance network model, but we will all continue to have different methodologies," he says. "I do think the quality network differentiation will continue." In addition to tiered networks, some health plans may use CFP data to support their pay-for-performance programs or for provider education. The most effective use of the CFP measures will be determined by MCOs, Grossman says.

Keeping busy

Many contractors and consultants are working on the undertaking, including Computer Sciences Corp., which has been chosen to aggregate the data. Health plans and employers participating in CFP pay an annual fee, plus a per member, per month fee for data management.

Ihrie makes the case that the nation's biggest companies have a self-interest and a civic duty to take aim at the health care cost trend line.

"Health care costs are growing far more rapidly than revenue or profit for almost every company, and the situation is unsustainable," he says. "As a major corporation, we believe we have an obligation to our employees, customers, shareholders, and the community to participate in efforts that address the serious health care issues we face as a country."

Sweeney, at Assurant, believes that, as a CFP leader, she is working for the survival of employer-sponsored health care in America — and an even bigger mission than that.

"But it is also critical to health care in general," she says. "The issues about quality go beyond the employer arena."

CFP Performance Measures Version 1.0 Summary
  Efficiency Quality
Hospital
  • Standard Hospital Resource Use (SHRU) — 3M All Patient Refined Diagnosis Related Groups (APR-DRG)
  • Hospital Patient Safety Survey — Leapfrog Group
  • National Quality Forum-endorsed Joint Commission on Accreditation of Healthcare Organizations (JCAHO) Measures and Centers for Medicare and Medicaid Services (CMS) Voluntary Measures
  • Transplant Graft Survival — United Network of Organ Sharing (UNOS)
  • Co-morbidity Adjusted Complication Risk (CACR) — University of Pennsylvania
Physician
  • Standard Episode Resource Use (SERU) — Symmetry Episode Treatment Groups (ETG)
  • Compliance with evidence-based guidelines (Rand Quality Indicators, NCQA HEDIS level measures, and Resolution Health measures)
  • NCQA's Physician Recognition Programs (PRP) in Diabetes, Heart/Stroke, and Physician Office Link
Source: Care Focused Purchasing

Lola Butcher, who writes about health care business and policy, lives in Springfield, Mo.

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.