EyeNet magazine, May 2008
When the letter from BlueCross and BlueShield of Texas landed on his desk last October, oculoplastic surgeon John W. Shore, M.D. couldn’t believe his eyes. The insurance company was creating a new network of “low-cost” physicians who follow evidence-based practices. BlueChoice Solutions was to be an all-star team. Shore had not made the cut. The Austin-based ophthalmologist who co-founded Texas Oculoplastic Consultants in 1997 sees patients from all the other BCBS plans—even the low cost plans offered by BCBS that have unattractive rates. He thought for sure he would have made the Solutions team.
“We were rankled,” remembers Shore. “It wasn’t that we were going to lose that much money. It is more from the patient’s perspective. They were going to have to pay out-of-network prices to see us since we would not be a part of that plan” After all, many patients needing oculoplastic surgery in Austin are probably going to Texas Oculoplastic Consultants (TOC). It is the only practice in town limited to oculoplastic surgery. But suddenly, patients were walking through the doors of TOC and being confronted by potential roadblocks and significant financial barriers to care. “We knew some patients would not seek needed care because of significant out-of-network charges since we were excluded from the Solutions network,” Shore states. “We try to be proactive with our patients and make sure they understand the situation before they get here. We were sure we would get constant haggling about bills because of co-pays approaching 30 percent. For some people the difference between a $50 co-pay and a $210 co-pay is a major stumbling block.”
Ted Haynes, vice president of health care delivery, BlueCross and BlueShield of Texas, acknowledges that an individual choosing Solutions or an employee whose company only offers Solutions—and not the broader BlueChoice network, of which Solutions is a subset--does face some conflict over cost of the health plan versus access to physicians.
Angry patients, angry docs. Their ranks are growing as insurance companies across the country introduce new, exclusive networks like BlueChoice Solutions catering to cost-conscious companies and consumers. The networks offer lower premiums and co-pays in exchange for restricted networks which ostensibly—and that is the key word, ostensibly—feature physicians whose per episode treatment costs are lower, and who have shown they are “quality” providers. BlueChoice Solutions is far from the only network of this kind. In January, UnitedHealthcare introduced an affordable health plan called EDGE which United’s CEO described as offering “an affordable alternative to consumers who receive care from specialists recognized for high-quality, cost-efficient care.” In Massachusetts two years ago, the head of the Group Insurance Commission, a quasi-state agency, ordered all insurance companies offering health plans to all state and many municipal employees to group all physicians in two tiers. All the health plans, be they Tufts, Harvard Pilgrim, Unicare or the others, do their tiering a little differently. But in all cases, the plans try to steer members to purportedly less expensive Tier 1 physicians, visits with whom call for lower co-pays. Bill Rich, M.D., medical director for health policy for the AAO, says similar plans are starting to crop up in states such as Georgia and Alabama.
Everyone agrees, emphasizes Rich, that a health plan which carefully and transparently evaluates physician costs and uses established, respected quality measures ought to be able to establish networks based on those clear, clean facts. But so far, none of these new networks advertised as “low-cost, high-quality” are fully transparent, nor are their cost and quality measures carefully developed. This past February, Linda Lacewell, who heads New York Attorney General Andrew Cuomo’s health-care industry task force, characterized the Ingenix database owned by UnitedHealthcare, which is the major health claims data base, as “garbage in, garbage out,” according to a story in the Wall Street Journal.
Most health plans use that Ingenix database and run the claims information through what is called “grouper” software, where the claims are grouped into episodes of care and each physician is then given a total cost for an episode. The three grouper products out there are Ingenix’s Episode Treatment Group (ETG), MedStat Episode Groups (MEGs) and Cave Consulting Grouper (CCG). Of these illness classification systems using groupers, the ETG methodology has 90 percent of the market. For ophthalmologists, a typical episode of care might be chronic open angle glaucoma. Bill Rich explains that when grouper software looks at chronic open angle glaucoma, for example, it tosses in an ophthalmologist’s charges to the insurance company for imaging of the nerve, diagnostic testing, surgery, drugs, facility fees for surgery and more. Those charges, of course, are probably greater in the practice of a glaucoma subspecialist where where many end-stage patients are seen, as opposed to a general ophthalmologist such as Bill Rich, for whom glaucoma patients may only be 20 percent of his patient load, with many in the early stage of the disease. Yet the grouper software compares Rich’s costs for treating chronic open angle glaucoma to the costs of the academic physician, and designates the latter as a “high cost” provider.
Haynes of BCBS of Texas says BlueChoice Solutions does not use the Ingenix data and uses MEGs as its grouper software. “We look at episodes, and case mix adjust them, meaning we account for more serious versus less serious cases, take into account co-morbidities and any other complicating factors.” In fact, Solutions puts a considerable amount of information on its Web site (http://www.bcbstx.com/provider/bluechoice_solutions/tool_raci.htm) explaining how its risk adjustment process works. However, they are unable to risk adjust diseases like glaucoma with no co-morbidities and only one ICD9 code for both early and advanced disease. Nonetheless, Solutions is one of the better networks out there, a fact recognized by the Medicare Payment Advisory Committee, which advises Congress. In an October 2007 report, MedPac wrote: “Health plans included in the study were generally in the early stages of using resource measures to assess provider efficiency, with fairly limited applications to benefit design, payment, or provider
selection. However, BCBS of Texas was well ahead of the other plans.”
Solutions may be risk adjusting better than other similar “low cost” plans, but even its methodology is not fully transparent, nor is it without significant shortcomings. For example, Solutions averages episode costs among similar physicians in each of Texas’s 23 regions. That means that John Shore’s average costs are compared to the average costs for other eye surgeons—not oculoplastic surgeons—in an area that includes Austin and perhaps other nearby counties.
“The data they use is totally flawed in my opinion,” Shore explains. He asked for, and was given by BlueChoice Solutions, bar graphs comparing his per episode costs to those of other eye physicians, all of whom presumably were eye surgeons of some type. “We were being compared to practices whose patients did not need the same services our patients require.” For instance, as an oculoplastic specialist Shore is called upon to repair complex lacerations, fractures, infections and major head and neck trauma. Patients with these injuries require intensive services such as CAT scans, hospitalization for intravenous antibiotics, or intensive nursing care. ”Ours is an intense surgical practice,” he explains. “Therefore our use of hospital resources is more and our costs are correspondingly higher.”
Moreover, in Shore’s case, he may treat an episode of orbital inflammatory syndrome (pseudotumor) requiring a four or five day stay in the hospital as the result of a referral from an optometrist to a comprehensive ophthalmologist who then refers the patient to Shore. The “episode” costs for the patient’s office visits reported by the first two physicians may be thrown into Shore’s episode costs. That is because some insurance companies typically assign responsibility for each episode’s actual and expected costs to a physician based on an attribution rule such as: “responsibility is assigned to the physician who accounts for 30% or more of professional and prescribing costs included in the episode.” For BlueChoice Solutions, an episode is billed to the physician or professional provider who bills the greatest total Relative Value Units (RVUs) in that episode (excluding those billed by anesthesiologists, pathologists, and radiologists).
Another problem is that an ophthalmologist may only have a couple of episodes, and so it would be statistically invalid to assign him an “average” cost.
Not only are there some imperfections in the way episode costs are calculated and analyzed for these new “low cost” or “tiered” networks, but health plan claims that the networks contain “high quality” physicians are also open to question. Haynes of BlueChoice Solutions says that network doesn’t make a “high quality” claim, only that the physicians included follow evidence-based measures (EBMs), the identity of which is published on the BCBS Texas web site. For ophthalmologists, the EBM is an annual visual field test for patients with primary open angle glaucoma. Any physician who is more than two standard deviations from the mean is excluded from Solutions. Haynes says this EBM comes from the AAO. But Flora Lum, MD, AAO policy director for quality of care and knowledge based development, says that is not a performance measure developed for CMS’ PQRI, but is based on a recommended frequency in the Academy’s Preferred Practice Patterns.
In Massachusetts, according to Cynthia Mattox, MD, vice chair and director, glaucoma and cataract service at the New England Eye Center, Tufts University School of Medicine, and a member of AAO's Health Policy Committee, health plans use as their quality determination whether a diabetic patient had a dilated exam in the past year. That is it. What made it worse, at least initially, was that the companies were only counting exams billed by an ophthalmologist using evaluation and management CPT codes. The Bay State Group Insurance Commission was not recognizing diabetic dilated exams when the claim listed a "V" code, which is used for documenting "routine eye exams" billed to vision care plans. Michael Price, M.D., uncovered that discrepancy and brought it to the attention of the GIC which corrected the oversight. Overnight, the percentage of ophthalmologists rating in the highest quality tier went from 65% to 98%.
No private insurance plan has come close to the quality determination effort made by the Centers for Medicare and Medicaid Services (CMS). It developed a Medicare Physician Quality Reporting Initiative (PQRI) in 2007, which is being continued in 2008, where physicians are offered a 1.5 percent bonus based on their reporting of stated quality measures, four of which were designed in 2007 exclusively for ophthalmologists, and which were developed by a workgroup co-chaired by the American Academy of Ophthalmology.
For primary open-angle glaucoma, an ophthalmologist has to dilate the pupil and evaluate the optic nerve in 80 percent of the patients he or she sees. For age-related macular degeneration, the quality standard is a dilated macular examination with documentation of presence or absence of macular thickening or hemorrhage, and the level of macular degeneration severity. For diabetic retinopathy, there are two indicators. For one, the physician has to document the presence or absence of macular edema and the level of severity of retinopathy. The other requires communication with the primary care physician managing the on-going diabetes care. The fifth indicator, new in 2008, is a diabetic eye exam annually, or every two years if there was a negative exam performed the year before. There are also two structural measures available for all physicians also: whether a physician has and uses electronic health records and whether he or she uses electronic prescribing.
Typically, ophthalmologists have to bill the “quality” codes for 80 percent of their patients, and for three of the four indicators, unless they do not see patients for whom those indicators come into play. In some instances, an ophthalmologist may only show 80 percent for one indicator. The maximum annual Medicare bonus amount available is approximately $4,400. Rich says that is very simple for ophthalmologists to document those quality measures, and points to the fact that ophthalmologists, at 60 percent, have the highest participation rate of any specialty in the PQRI.
The private “low cost, high quality” networks now cropping up around the U.S. are neither as credible nor as transparent as the PQRI. At least BlueChoice Solutions offers physicians an appeals process if they feel they have been unfairly excluded. Haynes says a peer review committee composed of physicians hears appeals, one of which was made by John Shore. “We stood up to them,” he says. “As soon as someone looked at data, they said ‘We’ll let you guys in.’” But the reason he really won his reprieve, probably, was that his practice is the only one in Austin that does ocuoplastic surgery.
That would be less likely to happen in Boston, for example, where there is a larger supply of eye surgeons, including those like Cynthia Mattox at the New England Eye Center. She says, as Shore does, it is the patients, not the physicians, who are ultimately hurt by these poorly-designed networks, which shift higher costs onto patients, and save the insurance company money. “Patients are going to be penalized for seeking subspecialty care, even if that is the most cost-efficient way for them to get their care,"Mattox says.
