When it comes to selecting the most attractive HMOs, beauty is in the eye of the beholder.
That's the premise behind a new evaluation tool created by the international consulting firm Watson Wyatt Worldwide. The tool was developed to rank the top HMOs in Connecticut, New Jersey and New York. Instead of approaching the task from a singular point of view, the survey instrument weighs the opinions of purchasers, providers and patients.
"It's our belief that a successful managed-care program will meet the needs of employers, providers and patients," said Ted Nussbaum, Watson Wyatt's healthcare practice leader for the New York region. But the instrument also can be customized to produce a list of HMOs that reflect the unique values of a particular purchaser, payer or provider, he said.
Watson Wyatt's scoring system and HMO scorecard grew out of a series of employer-provider roundtable discussions on managed care in the New York area. Nussbaum led the discussions, which have involved some 40 provider and Fortune 100 organizations.
Under the scoring system, purchasers rated HMOs on 15 items, including service area and annual rate increases. Providers' 13-point scoring system included medical-loss ratio and level of capitation. Patients were also brought into the process, scoring plans on 12 items, including provider access.
The resulting 72-page scorecard ranks HMOs based on the differing values of each constituency and provides a composite score.
For example, Health Insurance Plan of New York, with a score of 54 out of 100, was the second-favorite plan among purchasers. Employers were fond of the HMO because of its reimbursement strategy, provisional National Committee for Quality Assurance accreditation, availability of a Medicare risk product, low administrative expenses and provision of reports under the Health Plan Employer Data and Information Set.
When providers' and patients' ratings were taken into account, HIP slipped to seventh place out of the 12 HMOs in the New York survey. Providers found HIP to be just average. They liked the plan's high medical-loss ratio but didn't favor its low enrollment growth and reimbursement strategy. Among patients, HIP fell next to last among the 12 HMOs. "The very low patient rating was due to the higher than average number of grievances and its reimbursement strategy," the report noted.
Both U.S. Healthcare and Aetna Health Plan scored well overall. Because the report is based on 1995 data, the plans are listed separately, although Hartford, Conn.-based Aetna announced earlier this year that it plans to acquire the Blue Bell, Pa.-based HMO.