Health Plan Cost Poor Indicator of Value

Jeff Elliot for HealthLeaders Media, October 19, 2010

With extensive comparisons of health plans' performance and utilization of resources, the National Committee for Quality Assurance (NCQA) has determined that higher spending on healthcare doesn't necessarily translate into better quality care.

"More care is not always linked to better results, confirming that the saying 'you get what you pay for' does not apply to healthcare," the nonprofit accreditation firm said in a statement.

This conclusion emerged from the organization's 2010 State of Health Care Quality report that analyzed performance measures from more than 1,000 plans providing coverage to nearly 120 million Americans to determine the overall quality of American healthcare.

By comparing quality measures with what NCQA calls Relative Resource Use  data—an evaluation of how extensively plans within a certain region leverage healthcare resources relative to the populations they serve—NCQA was ultimately afforded a glimpse into the value a health plan offers. In fact, it determined that more use of resources, such as inpatient bed days or procedures, is actually often associated with poorer quality, translating into a bad value for consumers and employers.

In the overarching quality discussion, health plans serving states in the South and Southeast scored lowest in comparisons of NCQA's popular Healthcare Effectiveness Data and Information Set (HEDIS) quality measures, while North Atlantic, Midwestern and Pacific Coast states including California and Oregon ranked highest based on their reported management of common chronic diseases.

And while the organization was encouraged by gains in overall clinical quality measures such as improvements in colorectal cancer screening for commercial plans and eye exams for diabetic patients in Medicare plans, it was disheartened by a 4% decline in immunizations among children in commercial health plans.

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