Blue Cross to Rate Doctors

Blue Cross of California, one of the nation’s largest health insurers, this fall will begin keeping a quality scorecard on thousands of physicians and pay bonuses to those who meet high standards of care.

The incentive program, to be announced today, is part of a growing movement nationally to hold health providers more accountable for the quality as well as the cost of care. In recent years, almost all of the quality focus has been on HMOs.

The Blue Cross initiative is an expansion of a bonus plan based on patient satisfaction for HMO doctors that was launched last year. The latest program is unusual in that it attempts to track the performance of far more doctors, many of them in solo practice, and to motivate them to follow the industry’s best practices in the treatment and preventive care of patients.

The program will apply to many of the 43,000 California physicians in Blue Cross’ preferred provider organization, or PPO, which has more than 4 million members--double the HMO enrollment.

With about half of all insured Americans now enrolled in PPOs, analysts said such incentive programs could have widespread consequences.

“It’s important to apply [quality measures] to the PPO side, because there’s a decided market shift to looser PPO networks as opposed to a tightly managed, closed HMO network,” said Peter Boland, a health-care expert in Berkeley.

The scorecards initially will not be disclosed to consumers, and the bonuses to doctors will be as much as $5,000 annually. Blue Cross estimated it will spend $1.1 million to run the program over three years. The company said it did not know how much it would pay out in total bonuses, but said the money would not take away from existing fees paid to physicians for medical services.

Notices about the program, which is voluntary, will go out this month to an initial group of 15,000 doctors. A spokesman for the California Medical Assn. was critical of the program, saying it was a marketing ploy aimed at attracting more members at a time of open enrollment.

Other physicians and medical groups familiar with the program said the reward amount may not be enough to stimulate significant change. Others raised concerns that Blue Cross of California, which has had a contentious relationship with physicians over inadequate payments, may use the scorecards and reward program to extract lower reimbursement rates for medical services.

Several doctors and some big medical groups were cautiously supportive of Blue Cross’ plan, saying that many physicians do not know how they stack up against their peers, and that unlike most professions in which pay based on performance is the norm, doctors have few such incentives to improve care.

“I think it’s a bit of a watershed event,” said Dr. Robert Margolis, chief executive of Healthcare Partners Medical Group, which has 2,500 doctors in Los Angeles and Orange counties. “My guess is that other PPOs will latch on to this to see if this is a way to improve care.”

Cheryl Damberg, a senior health policy analyst at Rand, a nonprofit research institution, said an incentive program like this is overdue. “We know very little about the quality of care being delivered in that [PPO] market,” she said.

One reason for that, she said, is that PPOs generally don’t have the kind of accreditation process and regulatory requirements of HMOs to track and publicly report clinical care data.

WellPoint Health Networks, which owns Blue Cross of California, said it could introduce a similar program in other states where it operates. The Thousand Oaks-based company is one of the nation’s largest health insurers with more than 13 million members.

The physicians’ scorecard will be based largely on 16 clinical measures that are accepted as high-quality care.

They include how well doctors are providing needed childhood immunizations; screening for breast, cervical and colorectal cancers; and effectively managing the care of chronic conditions such as asthma, diabetes and depression.

“What I would applaud about this is they’re looking at appropriate medical indicators,” Boland said. “To the extent that any physicians adopt these practices, that will save money.”

Blue Cross officials said they can obtain reliable statistics on treatment practices by examining doctors’ claims data, which generally provide detailed information about services provided.

Endocrinologists who treat diabetics, for example, will be scored on the percent of their patients who have periodic retinal exams, which is widely recommended to reduce problems of blindness. Blue Cross said its current data show that only 40% of PPO members who are eligible for the exam are receiving it.

Some doctors, however, questioned how accurately Blue Cross could track data for many PPO patients, who frequently switch health plans and doctors.

The Blue Cross scorecard also will incorporate other measures, such as being board certified, opening the practice to new patients and prescribing generic drugs when appropriate.

Blue Cross said each physician who participates will be able to see their score on the Internet and compare it against an average for others in the same specialty and region as well as a target measure for everyone. Doctors will not be able to view scores of other individual physicians.

Dr. Woodrow Myers, chief medical officer for Blue Cross of California, said he hoped this information will be incentive enough for doctors to elevate their game. “There’s a little bit of psychology here,” he said, noting that doctors are traditionally very competitive. “I don’t think anybody wants to be in the bottom quartile.”

Myers said the amount of bonus and other aspects of the program may be adjusted or fine-tuned. He said this incentive program was a first step in linking doctors’ pay with performance.

Blue Cross officials said they had no estimate of how much the program might save in reduced medical claims for them, or whether any of this would translate into lower premiums for employers and consumers.