Employers Turn Health Care Focus toward Quality

By Noble, Holcomb R. | THE JOURNAL RECORD, July 12, 1995 | Go to article overview

Employers Turn Health Care Focus toward Quality


Noble, Holcomb R., THE JOURNAL RECORD


At a late June meeting quietly convened at a mountain house in the Grand Tetons of Wyoming, representatives of some of the largest employers and purchasers of health insurance agreed to pursue a fundamental shift in emphasis in the nation's managed health care systems: They want the primary focus to be placed on measuring the quality of care now that costs have begun to be controlled.

The broad-based agreement was reached at Jackson Hole by 30 officials of federal, state and local public employees organizations, consumer groups and officials of such major employers as American Express, Minnesota Mining and Manufacturing Co., Ameritech Corp. and Pepsico, which together represent an estimated 80 million consumers of health insurance.

"Monitoring quality will be the next battlefield," said Tom Elkin, assistant executive director of the California Public Employees Retirement System, which represents more than 800,000 employees of state and local government and their families.

He predicted that only health plans that demonstrated high quality would still be in existence by the year 2000.

Two elements of the consensus that emerged were regarded as significant by leaders in health care. One was that purchasers of health care for such a large number of consumers, with great potential power in the marketplace, were united in their desire for greater attention to quality.

The second was a decision to put into motion a plan to gather data, in a more uniform and comprehensive way than ever before, on the medical outcomes for various methods of treating patients for major illnesses.

In the first phase of the nation's transformation to managed care, which has accelerated in the last two years, the chief impetus has come from employers' desires to contain their costs.

Last year those costs dropped by 1 percent after 10 years of climbing as much as 18 percent annually. Economists attributed the drop in part to the rapid spread of managed care, especially health maintenance organizations that save money by closely controlling treatment decisions as well as by paying doctors and hospitals less.

The HMOs have insisted all along that they have not neglected quality in their attempts to control costs. But they face skepticism from some patients, doctors and legislators who contend that these organizations sometimes create incentives to spend less on medical care, perhaps shortchanging patients.

The critics say some of the organizations, which usually contract to provide all necessary care for a preset fee, are too reluctant to send patients to high-cost specialists, for example, and too quick to send patients home from hospitals.

Now, many leading HMOs as well as their critics are searching for objective ways to measure the quality of health care, a notoriously difficult task.

Research and accreditation groups have been working for some time to measure the effects of treatment decisions and establish guidelines for care. But there have been few widespread and detailed attempts to determine the results of different measures.

The Jackson Hole conferees agreed that over the long term such follow-up studies would be a major factor for both improving health and controlling costs.

The conference was held as part of a general re-evaluation currently under way in what many in the industry call Phase 2 of the health care revolution.

In part in response to the criticisms, managed care organizations, employers, consumers, doctors and hospital groups are trying to refine and revise their participation in the new systems, for example, rethinking methods of paying hospitals and doctors.

Dr. Paul Ellwood, a pioneer in the development of HMOs and the head of the Jackson Hole group, which convened the meeting, called the agreement a milestone in the development of managed care.

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