September 23, 2004

Accountable health plans show fifth straight year of gains, but broader system still plagued by quality gaps; annual toll is up to 79,000 avoidable deaths, 66.5 million sick days, $1.8 billion in excess medical costs

CMS Administrator  Mark McClellan, MD, PhD, speaks at the 2004 State of Health Care Quality press conference.

WASHINGTON—A new study finds that the quality of care delivered by health plans that publicly report on their performance improved markedly last year. Yet the U.S. health care system as a whole remains plagued by deadly “quality gaps” that contribute to 42,000 to 79,000 avoidable deaths every year. The findings suggest that the system is deeply polarized, delivering excellent care to some people, and generally poor care to many others. NCQA’s annual State of Health Care Quality report also found that nearly 66.5 million avoidable sick days and more than $1.8 billion in excess medical costs can be traced to the health care system’s routine failure to provide needed care.

“The data we have tell a great story – health care quality for some is improving consistently and dramatically,” said NCQA President Margaret E. O’Kane. “But we only have data for accountable health plans. Why don’t we have performance data for the other 75% of the U.S. health care system? All types of health plans, hospitals and doctors should report on their performance. How else can we make informed choices?”

This year’s report also highlights various efforts aimed at improving health care, including several physician and hospital pay-for-performance projects, which are seen by many experts as a key part of the solution to the nation’s health care woes.
“Measuring performance allows us to do three very important things: inform consumer choice, reward quality and identify opportunities for improvement,” said Mark McClellan, M.D., Administrator, Centers for Medicare and Medicaid Services. “There is enormous potential in these activities to drive improvement and without measurement you can't do any of them. Medicare is 100% committed to pay-for-performance.”

Substantial Improvement
The performance improvements recorded last year among the 563 health plans that reported their results were among the largest ever. These plans cover about 69 million people and represent a subsection of the broader health care system. On most measures, the performance of the system as a whole did not improve significantly according to the best available data.

On several key measures, health plan performance improved by 4 percentage points or more. For example, on the important Controlling High Blood Pressure measure, average performance improved from 58% to 62%, an improvement that will mean about 2,500 fewer fatal heart attacks this year alone. Health plans are also doing a better job controlling the cholesterol of patients with diabetes (LDL<130). Rates for that measure improved from about 55% to over 60%.

For the third consecutive year, health plans serving Medicare beneficiaries demonstrated impressive gains in cholesterol management. In 2001, NCQA reported that Medicare plans controlled beneficiaries’ cholesterol to below 130 mg/dl in only about 53% of all cases; performance has since improved to 67%. Medicaid health plans made gains as well, with cardiac care, cancer and diabetes care rates all improving steadily.

“It’s good news that quality is on the rise, but we still have a long way to go,” said Peter V. Lee, J.D., President and Chief Executive Officer, Pacific Business Group on Health. “Purchasers see these quality gaps at the same time they are facing the fourth straight year of double-digit price increases. Employers and consumers are staggering under rising health care costs with the average annual family premium approaching $10,000. This report underscores that all too often we are not getting good value for that money.”

This year’s report includes initial results on four new measures related to osteoporosis treatment, colon cancer screening and overuse of antibiotics (2 measures). Osteoporosis is a common condition among women and is responsible for about 1.5 million painful and debilitating fractures every year. Colon cancer is responsible for 56,000 deaths a year, although cure rates are above 85% if detected early. Overuse of antibiotics is a serious public health issue, as it promotes the development of drug-resistant bacteria that are hard to treat.

The Quality Gap Toll
First reported in last year’s SOHCQ report, the quality gap refers to the difference between the national average on a given clinical measure and the performance of the top 10 % of health plans. The latter is used as a benchmark because it represents a realistic, achievable goal for the entire system. For instance, nationwide, only about 34% of Americans with high blood pressure have the condition adequately controlled. But among the top 10 % of all health plans, 71% have their blood pressure controlled, resulting in an enormous quality gap of 37 percentage points. The tables below show the consequences and costs of these gaps.

“It would never be acceptable to say, ‘I’m sorry we didn’t save your loved one – we knew how, we just didn’t do it,” said Ellen Stovall, President and Chief Executive Officer, National Coalition for Cancer Survivorship. “But these quality gaps show us that that actually happens thousands of times every year. And every time it happens it represents a failure to put health care knowledge into practice. Surely we can do better.”

Quality gaps exact a severe financial toll on the nation as well. In addition to the roughly $1.8 billion in direct medical expenses that can be traced to missed opportunities to provide needed care, employers lose another $9.6 billion in the form of reduced productivity among workers for whom these missed opportunities translate into extended illnesses and sick days.

Pay-for-Performance
One of the reasons for the health care system’s routine failure to apply best practice care is that current payment systems may inadvertently discourage it. Physicians and hospitals are often compensated based on the amount of care they provide, thus discouraging the use of new treatments and therapies that may send patients home sooner. Even serious medical errors may be financially rewarded if, as is often true, they justify additional charges.

Profiled in this year’s report are several pay-for-performance initiatives. Many of these initiatives are built around NCQA’s Physician Recognition programs, which are designed to highlight doctors who consistently deliver excellent care and/or who invest in practice systems and information technology shown to help improve patient care. Dozens of these efforts are currently underway across the country, including both public- and private-sector programs.

One such effort, California’s P4P effort, involves six of the state’s largest health plans, more than 200 physician groups and nearly 7 million enrollees. The initiative involves collecting performance data from participating health plans and physician groups and using it to produce reports and public scorecards that will be used by individual health plans to determine physician group incentives. Between $40 million and $60 million in incentives will be issued later this year.

The Bridges to Excellence effort, which is backed by large employers such as GE, Ford, UPS, Procter & Gamble, Verizon and others, offers doctors annual incentive payments of $50 to $100 for earning NCQA recognition for each patient they treat who is employed by one of the sponsoring companies. Individual awards issued to date range into the tens of thousands of dollars.

Expanding Accountability
The report identifies the health care system’s limited embrace of accountability (only HMOs and point-of-service plans regularly measure and report on their performance) as one of the principle stumbling blocks to improving health care quality. CIGNA HealthCare is the first and only national health plan to commit changing this, having pledged to report performance data for many of its PPO plans beginning in 2006.

“CIGNA is extending our quality improvement activities, measurement and HEDIS reporting to cover the millions of enrollees in our PPO plans,” said W. Allen Schaffer, M.D., Senior Vice President and Chief Clinical Officer, CIGNA. “This new voluntary program demonstrates our commitment to making the same advances in quality for PPO members as we have achieved through our many years of participation in HEDIS.”

The Nation’s Top Plans
This year’s report includes two "top ten" lists of the nation’s top performing health plans in terms of clinical care and member satisfaction. For the first time, the same plan, Harvard Pilgrim Health Care, topped both lists. For several years, Harvard Pilgrim has focused on constantly improving its capacity to provide accurate information and support to its members and physicians to help their decision-making. And for the last 5 years, Harvard has tied physicians' pay to performance on certain chronic and preventive care measures, the presence of practice infrastructure and, more recently, use of information technology.

“We work very hard to ensure that our members get excellent care and great service, and it's very gratifying to see that our efforts have paid off,” said Charles D. Baker, President and CEO of Harvard Pilgrim Health Care. “Our strategy has been to support the relationship between our members and their doctors with outreach, online support, and financial incentives that reward high quality. We're very honored to be #1 in both clinical quality and satisfaction.”

The report also includes ‘Top Five’ lists identifying the best regional performers.

Mental Illness: A Continued Area of Concern
No significant gains were recorded on key measures of the treatment of mental illnesses. Rates for two key measures – follow up care and medical management of depression – remain generally low and indicate that patients get the correct care only about 50% of the time. Depression and mental illness are among the nation’s most prevalent and most costly public health issues, yet only marginal gains have been recorded in these areas for the past eight years.

The State of Health Care Quality: 2004 is available on NCQA’s Web site. An expanded version of the report, including more detailed analyses, graphs and complete citations, will be added to the Web site later this fall. A printed version of the expanded report (including appendices and other information not available online) can be purchased by calling (888) 275-7585.

The data reported in the State of Health Care Quality report are drawn from NCQA’s Quality Compass^® 2004. This database of plan-specific HEDIS data is available on CD-ROM or as an electronic data file in Microsoft^® Excel or SAS^® formats. Quality Compass can be ordered online through NCQA’s Web site or by calling (888) 275-7585.

Editor’s note: NCQA makes plan-specific Quality Compass^® data available to the media at no charge. Reporters interested in producing local health care “report cards” should contact the NCQA Communications Department at (202) 955-3518 to discuss data needs.

NCQA is a private, non-profit organization dedicated to improving health care quality. NCQA accredits and certifies a wide range of health care organizations, recognizes physicians and physician groups in key clinical areas and manages the evolution of HEDIS^®, the tool the nation’s health plans use to measure and report on their performance. NCQA is committed to providing health care quality information through the Web, media and data licensing agreements in order to help consumers, employers and others make more informed health care choices.

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