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HMO alternative gives doctors and patients more freedom

Oregon physicians join a plan, similar to one in Minnesota, that lets them set their own fees with employers.

By Myrle Croasdale, amednews staff. Oct. 8, 2001.

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Managed Care: What's Next?"
With the managed care system drawing complaints from all quarters, doctors, patients, payers and even insurers themselves found themselves looking for alternatives to a concept that hadn't met its promise of improving care while reducing costs. This 2000-02 occasional series highlighted what physicians and others were doing to come up with a way to improve the system -- or replace it with something else.

Even though there are no employers signed up and no insurance plan to help carry it out, about 3,700 doctors in the Portland, Ore., area are throwing their stethoscopes in the ring with a health plan model that would allow them to set their own rates and have greater control over medical decision-making.

Along with the doctors, 24 hospitals and 14 health systems in the Portland area have signed up with Minnesota-based Patient Choice Health Care, the company said. Patient Choice has operated its model, called Choice Plus, in the Minneapolis-St. Paul area for four years.

The plan is attractive to doctors for many reasons, said Jim Waskey, MD, diagnostic radiologist and president of the Interhospital Physicians Assn. in Portland.

"It's a way to work closer with employers to better meet their needs for quality and cost," Dr. Waskey said. "It broadens the base of insurance companies that we draw patients from, and that diversity is good for physicians. It has innovative issues on quality, and physicians are interested in improving quality and being compensated adequately for their efforts."

In a nutshell, the plan has "health care systems" or networks of doctors and hospitals who work as a unit in submitting bids to Patient Choice. The networks are organized in tiers according to their fees and what type of care they provide, such as whether patients need referrals or if they have open access to specialists.

Employers pay a fixed rate for the lowest-level tier, and employees who want a higher-level network pay the additional cost themselves. Patient Choice lists the fees of the different systems so consumers can see what they're choosing. [...]