Summary of Section Four 


Background - Competition among managed care plans is most likely to improve the visible, service quality aspects of health care delivery, such as waiting times, geographic proximity and convenience, and interpersonal communication with patients. It is far less likely, until consumers are educated to understand sophisticated quality measures, to impact complex technical issues in quality of care.

Most consumers recognize that they do not possess the clinical knowledge and expertise to evaluate the quality of health care services. An effective complaint and appeals system will provide some protection against egregious cases of denied access or poor quality but it cannot begin to uncover the potential universe of systemic quality concerns. Particularly under managed care, the average consumer will not know when medically necessary services are being withheld or that treatments received did not meet accepted practice guidelines. This concern is exacerbated for those who most need good health care - the disabled, chronically ill and the disadvantaged.

Managed care plans, and their participating network of providers, face uncertainty of their own in understanding the complexity of clinical medicine. It is difficult for plans and providers to keep abreast of an ever-changing medical knowledge base as medical research produces new understandings about health and illness along with new tests and treatments. Plans and their participating providers and facilities need help in tracking this constantly changing field, integrating new medical knowledge into active practice and identifying quality benchmarks.

Independent quality monitoring and professional oversight is a well accepted principle in most industries. In the context of managed care, with the incentives to underserve, the monitoring of access to care becomes imperative. Independent monitoring is needed to identify managed care plans with low utilization rates for specialist referrals, hospitalizations, and other clinical procedures and treatments. In addition, access to care for vulnerable populations requires special attention by monitoring programs. Efficient and effective population-based methodologies are well established to monitor utilization rates within managed care plans, particularly if patient encounter databases are available.

Independent professional oversight is also needed to hold plans accountable for their stated commitment to continuous quality improvement and to facilitate improvement activity. The application of quality improvement science to the health care industry shows the promise of accelerating patient care results for the largest number of health care consumers. Independent monitoring entities, with expertise in quality improvement, could help facilitate plan improvement initiatives by disseminating new medical knowledge and best practices and organizing community-based quality improvement initiatives across all plans licensed in the state.

Independent quality monitoring and oversight is well established in the public sector health insurance programs. Since the early 1970's the Medicare program has contracted with independent, state-based, Peer Review Organizations (PROs) for quality monitoring and review of Medicare's fee-for-service system.

Since the late 1980's, PROs have also reviewed the quality of care provided by Medicare HMOs. Current PRO review of Medicare HMOs is focused on monitoring and facilitating plan improvement activities through local improvement projects. National projects are underway to improve breast cancer screening and the management of heart disease and diabetes. PRO efforts, particularly population-based monitoring of patient access to needed care, have been hampered by HCFA's unwillingness to mandate HMO reporting of patient encounter data.

By federal mandate, state Medicaid agencies must also contract with external quality review organizations (EQROs) for the evaluation of managed care services provided to Medicaid beneficiaries. External quality monitoring for managed care in both the Medicaid and Medicare programs are relatively new initiatives with few published results to date.

In the private sector, independent oversight of the quality of care is not a well established principle. Employers and employer coalitions have organized state and local outcome initiatives to facilitate and promote improvement activities among plans at the community level, but initiatives are isolated.

Conclusion - Consumers enrolled in managed care plans do not have the clinical expertise to evaluate the quality of care provided by plans, particularly on a systemic basis. Health care plans and participating providers find it difficult to keep abreast of the ever-changing medical knowledge base and need help in identifying best practices. An independent quality monitoring and improvement program is needed to track patient access to appropriate care, facilitate internal and cross-plan quality improvement initiatives, and hold managed care plans accountable for achieving ever-improving patient care results.

Model Legislation Highlights

The fourth section of The Quality Imperative establishes an independent quality monitoring and improvement program. The state is directed to contract with a Quality Improvement Foundation (QIF) through a competitive bidding process.

QIFs are directed to:

The QIF is required to produce an annual report summarizing its activities and findings. QIF findings and assessments of health plan performance inform the decisions and oversight activity of state entities responsible for licensing and regulation. The QIF is required to report specific findings to state licensing and regulatory entities when: health plan utilization patterns demonstrate that enrollee access to needed services is being impeded on a systemic basis; the quality of care patterns in a plan presents imminent harm and danger to patient health and safety; performance data demonstrates a plan's inability to achieve systemic improvements in the process and outcomes of health care delivery; an external data audit reveals a plan that is reporting false and/or inaccurate data on its performance.

The model legislation outlines specific requirements for QIF designation by the state. To be eligible, an organization must be: a private sector, non-profit organization; governed by a representative board of interested parties in the health care system in the state but with a majority of consumer members; staffed by individuals with expertise in quality improvement, epidemiology, medical statistics, clinical practice guidelines and performance measures, and provider and consumer education. Organizations with demonstrated experience in quality monitoring and improvement activity are given preference in state contracting. Funding for QIF contracts will be based on a modest assessment of managed care plan premiums in the state.

Consumer Coalition for Quality Health Care


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