California insurers adopt quality-pay initiative

The state's largest health plans propose including the state's largest physician groups in up to $150 million of bonuses based on performance measures.

By Mike Norbut, AMNews staff. Nov. 18, 2002.

Six of California's largest health plans -- many of which already have their own quality-based incentive plans in place -- have introduced a common set of criteria to rate physicians and give them performance-based bonuses.

The Integrated Healthcare Assn. plan, "Pay for Performance," would offer ratings based on specific clinical measures, patient satisfaction and the use of technology. The state's largest medical groups, representing some 8 million HMO patients, would be able to take part in the voluntary program, and organizers estimate health plans could pay out as much as $2 per member per month, with a total possibly reaching $150 million.

The program, which could affect as many as 40,000 physicians, would start in 2003, with the first bonuses paid in 2004. IHA, based in Walnut Creek, Calif., also would publish a scorecard available to the the public in 2004.

The IHA is a policy group governed by representatives of health plans, physician groups, health systems and hospitals, as well as consumers and leaders of other health-related businesses. Funding comes through grants from the California HealthCare Foundation and the Robert Wood Johnson Foundation.

The six original participants in the program will be Aetna U.S. Healthcare, Blue Cross of California, Blue Shield of California, CIGNA Healthcare of California, Health Net, and PacifiCare; other plans may join in the future, said Beau Carter, IHA's executive director. The plans that already have an incentive program in place will adopt most, if not all, of the IHA criteria to make the program as universal as possible, he said. [...]