Give Employers the Means to Measure Physician Performance

By Dr. Milstein

Dec. 11, 2009

While the national debate on health care reform unfolds, one major point of agreement is that our health care system spends a lot of money but does not always make us healthier. Employers, as providers of health care benefits to 160 million Americans, are keen on improving the way health care is delivered and reducing its cost.

One solution employers have tried is connecting their employees with physicians who are better at making patients healthy and do so at a lower cost than their peers do. Health insurance officials conservatively estimate that using better-performing physicians could lower annual per capita employer health spending by up to 10 percent.

These efforts, however, have been thwarted by a lack of data to enable comparison of the performance of many physicians.

Such data does exist. It is the government’s Medicare billing database. But employers do not yet have access to it. This must change.

Using the database properly, employers could determine which doctors provided the best care at the lowest cost. Employers could then more confidently create incentives to steer employees to the best doctors.

Every time one of the tens of millions of Medicare-covered citizens undergoes a course of treatment shaped by one or more physicians, the government—which pays for most of it—accrues an electronic billing record along with individual physician identifiers.

Visionary employers such as Xerox, Boeing, Safeway and GM came very close to getting access to physician performance comparisons based on this database in 2007. Sens. John Cornyn, R-Texas, and Mark Warner, D-Virginia, are exploring its introduction into health care reform or Medicare legislation.

What’s missing in the current health care debate is stronger employer lobbying to give employers and consumers access to that database for public comparisons of individual physician performance.

Making reports from the database public could also help doctors improve care. As a physician, it’s easy for me to see why the doctor’s pen is regarded as the single most powerful influence on health care spending and clinical outcomes. Yet physicians operate at a disadvantage. For the most part, they don’t know how they compare with their colleagues on their rate of adherence to quality care guidelines and on the total cost of care for the entire stream of services that they so powerfully shape.

They fly blind, recommending tests and treatments without benefit of the comparative statistics that could help them learn from their peers how to practice better medicine with fewer dollars. Individual health insurers have attempted to generate such inter-physician performance comparisons, but most lack sufficient depth of claims data to do so reliably for the majority of individual physicians in their networks.

    The value of the Medicare database is hardly lost on the many researchers who already use it. The law, however, does not clearly allow the identity of individual physicians to be included in public performance reporting. Yet if each doctor’s quality and total cost of care were public, patients could compare doctors to see who was better. Just as important, doctors could learn how they compare with their colleagues, and adjust their practices accordingly.

    There has been predictable resistance. The American Medical Association has been fighting legal action by the nonprofit Consumers’ Checkbook to obtain performance comparisons under the Freedom of Information Act; the case may be on its way to the U.S. Supreme Court. Many doctors seek to avoid performance transparency or say information derived from the database does not accurately reflect their performance.

However, the Medicare database is paid for by taxpayers and belongs to taxpayers. In the Medicare program, physicians are vendors. They are not owed the same federal privacy protection as patients. Accuracy concerns were reasonably addressed last year, when New York Attorney General Andrew Cuomo successfully brokered an agreement on minimum measurement validity standards among the AMA, consumer groups, organized labor, employers and health insurers.

The Medicare database is a vast and ongoing repository of information that could help improve the performance of our health care system. As mentioned previously, Sens. Warner and Cornyn have expressed interest in reintroducing a variant of S.B. 1544, which Sens. Judd Gregg, R-New Hampshire, and Hillary Rodham Clinton, D-New York, sponsored in 2007 to enable private purchasers to have access to the database without jeopardizing patient privacy.

It is time for employers and other health care purchasers to ask their congressional delegation to either include S.B. 1544 or its equivalent in the current health care reform legislation or make its enactment a condition of this year’s annual congressional ritual of moderating proposed Medicare physician fee cuts.

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