BHCAG: Showing Success With Cost/Quality Rating
Minnesota's Buyers Health Care Action Group (BHCAG) yesterday released data that shows its innovative experiment in increasing provider accountability to consumers is working. Data "showed that low-cost clinic groups experienced the most significant enrollment gains after last fall's open enrollment period, with increases ranging from 15% to 57%." Higher-cost clinic groups, "for the most part, saw enrollment shrink -- except for one that also showed a high quality rating," according to the Minneapolis Star Tribune. The BHCAG "declined to identify" which among its 25 competing care systems, which are comprised of doctors, clinics and hospitals, had gained or lost members. BHCAG Executive Director Steve Wetzell said, "If consumers are willing to pay for a high-cost care system, especially if they have high quality indicators, that is fine. ... We are encouraged that consumers are clearly taking into consideration price and consumer satisfaction."
Making Them Pay
Unlike most employer health plans, 10 of the 28 BHCAG employers, collectively employing 60,000 workers, ask employees to pay premium differentials based on the actual cost of their health care coverage. Employees who choose the most expensive of three coverage options must pay an extra $19 monthly premium for individual coverage and $38 for family coverage. Those who choose the middle level pay an extra $8.50 for individual coverage and $17 for family coverage. Employees who choose the least expensive option do not have to contribute anything extra. According to Carolyn Pare, director of benefits and management for Dayton Hudson Corp., a member of BHCAG, the care system program is working because it gives employees the information they need to make health care choices. She said, "Consumers have never known which providers were expensive and which weren't. Many had a difficult decision when they were faced with paying a higher premium if their care system was more expensive. That's what BHCAG's program is all about, letting doctors compete and letting patients decide" (Howatt, 3/6).
Too Much Competition?
In related news, today's St. Paul Pioneer Press reports that HealthPartners, Minnesota's second-largest HMO and one of the largest among the BHCAG's "portfolio" of 25 competing care plans, announced earlier this week that it would part company with BHCAG. George Halvorson, CEO of HealthPartners, said, "We told them that we've been happy working with them the past five years, and we will continue to deliver the same high-quality service for the next 22 months of our contract, but after that we're done." As the reason for the split, Halvorson said, "They've become an HMO. We welcome the Action Group to the marketplace as a competitor." BHCAG CEO Steve Wetzell responded, "We are not a competitor. Our employers disagree strongly with the charge that we are."
The Times They Are A Changin'
The Pioneer Press reports that BHCAG has undergone a lot of changes since HealthPartners first came on board five years ago. Most recently, BHCAG asked all of its plans to make themselves available to "new markets and populations, such as Medicare and Medicaid and consumers who do not currently have access." For HealthPartners, the Pioneer Press reports, "that would mean selling the Action Group's health plan and selling its own health plan at the same time." In another action that is "disconcerting to HealthPartners, the proposal asks whether the bidder would oppose expanded legislation to 'level the playing field' with state regulated insurance products and health plans." BHCAG is currently not regulated like an HMO, and as a result, "does not pay the same taxes HMOs do, and is not required to set aside a reserve in case of unexpected costs." The Pioneer Press reports, however, that "[t]here has been talk ... about extending the HMO regulations to include programs such as" BHCAG. Wetzell said the language was not intended to make it appear that BHCAG is a "competitor to HMOs, or that it wants its administrator to be a lobbyist." He said, "We're not saying that if you don't march to our tune you can't have our money. That was intended to get the dialogue going on a tough public policy issue. No way is it a gag clause" (Borger, 3/6).