Perspectives on the Acute Care Continuum

The Acute Care Continuum is the integration of urgent, emergent, inpatient and post-discharge care of patients with acute medical conditions. 

Mapping the Relationship Between Health Plan Competition, Plan Payments, and Access to Quality Care

8/6/2012 9:43:44 PM | 0 comments

Based on the analysis I have posted here, there appears to be a fairly direct relationship between health plan competitiveness in state markets, allowable payments for in-network emergency care services (i.e. contracting rates for ED services), and access to Board Certified emergency physicians in these markets.  The data shows that lack of competition between plans for emergency physician services is associated with low contracting rates for these services, and that low payments from plans for in-network emergency physician services is in turn associated with lower numbers of board certified emergency physicians per 100,000 population in these states.  This data suggests that health insurance regulators should consider promoting health plan competition and mitigating the impact of health plan monopsony on the quality of health care services in the commercial health insurance market. 

Emergency physicians are subject to coercive contracting by health plans that use their market leverage with hospitals to coerce emergency physicians to accept deeply discounted below market rates for emergency physician services, or lose their opportunity to staff the hospital’s ED.  In addition, emergency care services, are subject to the EMTALA obligation to provide care to everyone, even if the insurer refuses to pay fairly, or negotiate reasonable contract rates.  When a plan has substantial penetration in a market, especially when the plan accounts for more than 60 percent of the market; this leverage results in extremely low contracting rates for emergency care services, and this in turn undermines the ability of hospitals and emergency physician groups to recruit and retain qualified, board certified emergency physicians to live in these communities and work in these EDs. 

There is substantial evidence that qualify of care and board certification are directly related.  The following list represents some of the published studies on the subject: 

1. Chen J, Rathore SS, Wang Y, Radford MJ, Krumholz HM. Physician board certification and the care and outcomes of elderly patients with acute myocardial infarction. J Gen Intern Med. 2006;21:238-44. (Heart attack patients treated by a board certified physician receive higher quality care.) 

2. Hass JS, Orav EJ, Goldman L. The relationship between physicians’’ qualifications and experience and the adequacy of prenatal care and low birthweight. Am J Public Health 1995;85:1087-1091. (Pregnant women under the care of a board certified physician are more likely to receive the recommended number of prenatal visits and have a low birthweight infant.) 

3. Norcini JJ, Lipner, RS, Kimball HR. Certifying examination performance and patient outcomes following acute myocardial infarction.  Med Educ. 2002;36:853-59. (Patients treated for a heart attack by a board certified physician have a lower mortality rate.) 

4. Pearce WH, Parker MA, Feinglass J, Ujiki M, Manheim LM. The importance of surgeon volume and training in outcomes for vascular surgical procedures. JVasc Surg 1999;29:768-776. (Board certified surgeons are associated with better patient outcomes.) 

5. Prystowsky JB. Patient outcomes for segmental colon resection according to surgeon’s training, certification, and experience. Surgery. 2002;132:663-670. (Patients undergoing a colon resection by a board certified surgeon have a reduced illness and mortality rate.) 

6. Ramsey PG, Carline JD, Inui TS, Larson EB, LoGerfo JP, Wenrich MD. Predictive validity of certification by the American Board of Internal Medicine. Ann Intern Med. 1989;110:719-26. (ABIM-certified physicians score higher on the written exam than those who are non-certified, while the clinical skills of certified internists are rated higher than non-certified professional associates.) 

7. Silber JH, Kennedy SK, Even-Shoshan O, et al. Anesthesiologist board certification and patient outcomes. Anesthesiology 2002;96:1044-1052. (Non- board certified anesthesiologists have worse patient outcomes. 

To assess the relationship between health plan competition, allowable contracting rates for EP services, and access to board certified EPs, I chose to look at these variables in two major communities in each of the following states:  North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, and Tennessee.  I obtained two measures of health plan competition in each of these communities from  ‘Competition in Health Insurance: A Comprehensive Study of U.S. Markets’ published in 2009 by the American Medical Association.  One measure was the highest market share for any single plan in the community, and the other was the Herfindahl-Hirschman Index (HHI, a measure of the market concentration and competitiveness of a market overall.  The DOJ uses this index when evaluating the impact of a merger or acquisition on the competitiveness of a market.  Higher HHI numbers represent less competitive markets.

I also obtained 2011 data on allowable contracting payments for 99284 and 99285 CPT codes, which are used almost exclusively by EPs, from FAIR Health’s ‘Allowed Medical Module’ via a custom analytic for these two CPT codes for the 14 related three-digit geozips included in the study.  Incidentally, the analysis for the 99284 and 99285 codes in this study yielded almost identical results, probably because the rates paid for these two codes were related to each code’s RVUs rather than to different conversion factors.  I then used data provided by the American Board of Medical Specialties to identify the number of BCEPs practicing in each of the seven states as of 2011, which I corroborated with similar data provided by the AMA.  Below are some examples of graphic representations of the relationship between these variables.

The following two graphs show that as the health plan market becomes less competitive (higher HHI, higher market share for a single plan), the plan’s median contracting payment for emergency physician services falls.

 

 As Plan Market Share Rises - Contracted Payments Fall 

 

As HHI Rises (less plan competition) - Contracted Payments Fall 

 

The next graph shows that higher plan contracted payments are associated with better enrollee access to Board Certified Emergency Physicians, and likely with improved care quality in EDs. 

I believe that it is fairly clear from these graphs that there is a relationship between health plan competition, health plan contracting rates, and quality.  Clearly, there are a number of other factors that could account for, or alter, the appearance of these graphs.   For example, the randomly selected communities studied may have been a bit atypical in terms of plan competitiveness compared to the rest of the state (this was particularly true in Florida), or the data from FAIR Health might not be fully representative of payments from all payers in a geozip, etc.  In order to confirm or deny the truth of these cause-effect relationships, a study that compares large numbers of CPT codes and allowable payments across a much broader spectrum of geozips and types of plans, using a carefully designed study to address possible confounders, would be necessary, and this is way beyond my capability at this point. However, the evidence is certainly suggestive enough to warrant the attention of researchers, regulators, legislators, and advocates for health reform.  What’s good for the goose...

Research for this article is based upon healthcare data compiled and maintained by FAIR Health, Inc.  Dr. Myles Riner is solely responsible for the research and conclusions reflected in this blog. FAIR Health, Inc. is not responsible for the conduct of the research or for any of the opinions expressed in this blog.

This post also appears in The Fickle Finger.



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