Measuring the HMOs

Gov. Pete Wilson took a grasp this week on another dizzying round of HMO reform bills: He signed some on grounds of protecting the doctor-patient relationship, including one that prevented HMOs from unilaterally restricting the hospital stays of mastectomy patients. He vetoed others that he saw as interfering with medical decisions by requiring specific coverage, such as vaccines for children or contraceptives.

Not surprisingly, given the growing public frustration with managed care and managed care’s resistance to legislative mandates, Wilson’s decisions pleased few. Patient advocates demanded broader basic rights, while California HMOs complained that any new mandates are certain to hike premiums.

Wilson is one of many politicians who have slipped in addressing the question of how much and what kind of health care HMOs should provide. But it’s clearly an issue that politicians alone will not resolve.

Part of the problem is that there are no nationally agreed-on standards of health care quality, which helps explain why quality surveys are so inconsistent. Kaiser Permanente of Northern California, for instance, recently got an “excellent” rating from Newsweek magazine but a below-average rating from U.S. News & World Report.

Fortunately, California employer groups have begun tackling those issues, seeking ways to measure and increase quality without sending premiums through the roof. The Pacific Business Group on Health, an association of 35 companies that collectively buy $3 billion in health insurance each year, recently commissioned studies to measure how well various managed care plans cover procedures that the group’s own physician panels deem essential.

The group’s initiative will succeed only if California’s elected officials help by requiring health plans to disclose their success and failure rates for given procedures. State leaders could follow the model of New York and Pennsylvania, which require health plans to report their outcomes data for the 20 surgical procedures, like coronary bypass surgery, that have the highest mortality rates, as well as other measures.

In addition, Vice President Al Gore’s Quality Forum, a panel of HMO, consumer and employer groups that began meeting in New York last month, should work with employers and health plans on uniform quality measures.

It’s a goal that is widely embraced. One major proponent of quality standards is the nonprofit National Coalition on Health Care, co-chaired by former Presidents Bush, Carter and Ford. This month, the coalition will launch a campaign to identify exemplary “best practices” for maintaining health and treating specific conditions. But the issue is dearest to employers, who help provide health insurance for about half of all Californians. They now understand they can save money in the long run through good health care and identification of inappropriate or unnecessary kinds of care and reducing errors. By implementing “best practice standards,” one HMO in the Northeast cut cardiac surgery mortality rates 24% while trimming costs 20%, thus enabling it to reduce the premiums it charged employers.

As long as quality is based on medical science, there’s no reason why good medicine can’t be good business too.