Docs hail cost-rating critique
22% of physicians misclassified, RAND study says
hysicians are pointing to a new study published last week as further evidence that the methods health plans use to rate physicians based on cost are deeply flawed.
“This is a complete sham,” said Mario Motta, a cardiologist and president of the Massachusetts Medical Society, of the health plan rankings. “They’ve set this up to charge patients more and blame the doctors.”
The study by RAND Corp. researchers and published in the March 18 issue of the New England Journal of Medicine indicated that 22% of physicians in 10 specialties would be misclassified in a twotiered system based on cost. At the top end, the rate of misclassification for vascular surgeons was 36% using a common method of evaluating physicians based on cost.
The researchers examined claims data from four unnamed commercial health plans in Massachusetts from 2004 and 2005. A total of 12,789 physicians were included in the study of claims data from 2.8 million people, or
Pabout 44% of the state’s residents. Using so-called commercial software, the researchers sought to replicate methods used by health plans to evaluate physicians on cost. This meant constructing cost profiles of the physicians—grouping them based on claims for services, determining the cost of each episode, calculating the average cost of each episode, and adjusting for patient risk, among other complex variables.
The proportion of physicians who were misclassified as lower-cost ranged from 29% for otolaryngology to 67% for vascular surgery. The proportion of physicians who were not classified as lower-cost but who actually were lower-cost ranged from 10% for OB/GYN to 22% for vascular surgery, according to the study. The American Medical Association seized on the RAND report as verification of the group’s long-standing opposition to such physician cost-rating programs.
“The AMA calls on the health insurance industry to abandon flawed physician evaluation and ranking programs, and join with the AMA to create constructive programs that produce meaningful data for increasing the quality and efficiency of healthcare,” AMA President J. James Rohack said in a written statement.
Physician rankings based on cost and quality are becoming more popular as health plans and employers seek to rein in medical spending.
Eric Linzer, spokesman for the Massachusetts Association of Health Plans, said that much progress has been in the past five years to refine physician ratings. “I think we are a long way from where we were in terms of the data provided in the study,” he said. Linzer also pointed to a report by state Attorney General Martha Coakley in January that concluded that market clout of certain providers is a main driver of soaring healthcare costs in the state.
Still, the methodology of the rankings has come under fire.
In 2007, seven health plans operating in New York reached settlements with state Attorney General Andrew Cuomo to revise their physician rankings. And the Massachusetts Medical Society has sued the state Group Insurance Commission—the purchaser of health benefits for state and other public employees—over physician ratings. That lawsuit is ongoing.
Motta, the society’s president, said that he is ranked in the top tier for UnitedHealth Group, the second tier for Harvard Pilgrim Health Care, and the third tier for Tufts Health Plan. Motta practices at North Shore Cardiovascular Associates in Salem, Mass.
“That alone shows this is utterly unreliable,” Motta said.
Motta: “They’ve set this up to charge patients more.”