More and more, as health plans work to temper the adversarial nature of their relationship with providers, they're urging medical groups to handle their own utilization review and to take on more risk.
Since UnitedHealthcare set a precedent last year by announcing it would halt most prior authorizations, the character of how physicians relate with health plans is be-coming less "Mother may I?" and more subject to a retrospective examination of utilization data and practice trends.
But some California doctors, who have long been organized into medical groups or IPAs almost exclusively to take risk contracts from HMOs, say physicians should be careful what they wish for. They have learned that plans and groups may use other methods to control costs, with results that can be just as disconcerting as prior authorization.
One of these instruments, used particularly for primary care providers, is the utilization profile--a retrospective review of how many and what type of referrals or tests a doctor has ordered, which is then compared with the patterns of his or her peers. Doctors found to be outliers are pressured to change their practice habits in order to reduce the number of costly services they recommend for their patients. This can take the form of peer review, counseling, rewards or even punitive measures, such as withholding portions of a physician's fees.
"This is a culture shift for physicians," says Tom McAfee, M.D., CMO and executive vice president of Brown & Toland Medical Group, one of the largest IPAs in San Francisco and San Mateo counties with a 1,600-provider multispecialty network. "Physicians are not used to being profiled or held accountable. Their quality of care is assumed and implied but rarely measured."
McAfee says that while the group has done some utilization profiling, even experimenting with monetary incentives before retreating from that approach, it has not used the data in a punitive way.
In the past, Brown & Toland profiled a few specialty areas where it had budgetary problems, McAfee says, including physical therapy referrals and MRI orders. For physical therapy, he says the group looked at all primary care physicians, then required that the outliers get prior authorization on physical therapy referrals. "We did that for a year, saw that their referral rates came down, and we released them from that requirement," McAfee says, conceding the action was probably viewed as punitive by some doctors.
"The profiling effort is more about giving feedback reports for patients who need services and aren't getting them," he asserts. "Some physicians are willing to look at that, and some become very defensive. But overall, even after those challenges, physicians do pay attention. Even by just showing them data and giving them feedback--that communicates that someone is watching, which is enough to create a behavior change."
A Brown & Toland member who practices pediatrics at University of California San Francisco Medical Center argues that neither prior authorization nor retrospective utilization reviews decrease healthcare costs or make her a better doctor.
"It's just shifting the bureaucracy from one place to another," says the physician, who asked not to be named. "All we're doing is creating more paperwork for more bureaucrats." When she received a Brown & Toland utilization report in January 2000 telling her she referred too many patients, the doctor says her records had been mixed up with those of another physician. She's concerned that groups don't always have accurate data and don't take into account the type and severity of cases that individual doctors have.
"I'm going to see a different set of patients than my peers because I'm in a university setting," she says.
"It might mean I see more diabetes or more cerebral palsy that requires more neurology referrals; it doesn't necessarily mean I'm a bad doctor."
McAfee says Brown & Toland does adjust doctors' patient panels to reflect the fact that they have different illness, age and gender distributions. Yet some outliers inevitably ask questions that can't be answered without extensive chart review: Can you tell me that any referral I've made was medically inappropriate for the patients I care for? How do you know my patients aren't sicker?
"That's always a tough debate to get into," McAfee says, adding that it is difficult and time-consuming to try to prove otherwise. "What you end up coming down to is, 'I can tell you, next to your colleagues, your referral rate is 50% higher; you're our most expensive doctor in terms of referrals.' We've never used (utilization review) to remove a doctor from our panel," he says.
Having worn several hats, including those of practitioner, chief medical officer of a third-party benefits administration organization and current president-elect of the San Mateo County Medical Association, otolaryngologist Steven Kmucha, M.D., maintains sight of the various reasons different organizations have for profiling physicians.
"There is some anxiety in the physician community because they're concerned about how that data will be used, whether it will be to support or penalize,"
Kmucha says. "It all depends on which chair you're sitting in. The perspective is very critical. I think everybody realizes the data can be used inappropriately and therefore should only be used as a guideline."
Indeed, some California physicians have accepted that a more organized healthcare system must attempt to reduce treatment variation. In Hollister, internest and cardiologist Martin Bress, M.D., who contracts with UnitedHealthcare, has been little influenced by the plan's changes or its physician profiles, which he says can be flawed. But he says he sees the need for them.
"Part of problem is, it's hard to get a database that is really relevant," Bress says. "I've had to tell them more than once to correct their records. But I understand what they're doing, and sometimes it's helpful." He sympathizes because as president of his local IPA, San Benito Medical Associates, Bress also conducts utilization review for some of the group's large contracts.
"The issue is trying to explain to physicians what things cost. It isn't always that easy, but since we run our own shop, most people want to do well and respond favorably to counseling," Bress says. "Medicine is getting more structured, and there is more consensus about how to do things than in the old days."
For physicians who are very sensitive to the need for cost efficiency, Kmucha says, it can take more time to talk to patients about the decisions doctors make. But, he adds, that can make practice more pleasurable, too. Bress puts it more bluntly, saying it is a "continual challenge to explain to patients why we might not do certain things."
Kmucha says there are potential gains for physicians who have more information, about other doctors as well as themselves. "Whoever has the data has the power," he says. "There are physicians who really would benefit from seeing how the way they treat patients compares with other physicians."
Though some plans and groups share scores only with individual physicians, comparing them with unnamed peers, Kaiser Permanente has made a habit of opening the whole process so that it is physician-driven, says William Strull, M.D., assistant physician in chief at Kaiser's San Francisco Medical Center.
"We generally share the data of utilization with all the physicians in a unit or department because the whole purpose is to allow them to have a discussion and come up with what is appropriate," Strull says. "Over time, there is a reduction in the variation. Doctors don't want to be outliers, and they constantly regress to the mean."
In capitation-dominated California, not-for-profit Lifeguard, based in San Jose, is the only health plan in the state that uses fee-for-service as its exclusive means for paying physicians. But even Lifeguard uses an elaborate database that tracks, on a code basis, who is doing what to whom and how frequently, says Mark Hyde, president and CEO.
"We tell physicians that we will reserve a right to have a higher withhold on fee payment," Hyde says. "But that is a great exception. Of late, we've been abandoning the percentage withhold altogether for most doctors."
Lifeguard's first step, he says, is to talk about the situation with the physician. For example, after a study found that Lifeguard's C-section utilization rates were around 23%, the plan became concerned about one contracted doctor with a 35% rate. After a discussion with the doctor, they found he had good reason.
California Association of Health Plans spokesperson Bobby Pena emphasizes that utilization review can do more than penalize doctors.
"Most people think of it as monitoring to make sure doctors don't do too much," Pena says. "But it also serves the function of monitoring to make sure doctors are doing enough to make sure members are receiving the care they need. That's just as important as doing the reverse."