BILL ANALYSIS
AB 2533
Page 1
ASSEMBLY THIRD READING
AB 2533 (Fuentes)
As Amended May 6, 2010
Majority vote
HEALTH 19-0 APPROPRIATIONS 17-0
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|Ayes:|Monning, Fletcher, |Ayes:|Fuentes, Conway, Ammiano, |
| |Ammiano, Carter, Conway, | |Bradford, Charles |
| |Bradford, De Leon, | |Calderon, Coto, Davis, |
| |Emmerson, Eng, Gaines, | |Nava, Hall, Harkey, |
| |Hayashi, Hernandez, | |Miller, Nielsen, Norby, |
| |Jones, Bonnie Lowenthal, | |Skinner, Solorio, |
| |Nava, V. Manuel Perez, | |Torlakson, Torrico |
| |Salas, Smyth, Audra | | |
| |Strickland | | |
| | | | |
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SUMMARY : Requires health care service plans and health insurers
(collectively carriers) to annually submit their policies and
procedures regarding economic profiling and "quality rating," as
defined, to the Department of Managed Health Care and the
California Department of Insurance respectively. Specifically,
this bill :
1)Requires carriers to annually submit economic profiling and
"quality rating" policies and procedures to state regulators.
2)Defines "quality rating" as any efforts by a carrier or by an
entity contracted by a carrier to develop, evaluate, rate, or
designate a particular physician, provider, medical group, or
individual practice association based in whole or in part on
quality measurements and claims data.
3)Revises current law to require the filing to also describe how
the policies and procedures are used in network modification
and patient screening. Requires the filing to indicate how
the economic profiling or quality rating system being used by
the carrier takes into consideration risk adjustments that
reflect the accuracy and reliability of data and patient
compliance with a recommended procedure.
FISCAL EFFECT : According to the Assembly Appropriations
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Committee analysis, minor and absorbable workload to state
regulators to continue oversight of health plan and health
insurer reporting.
COMMENTS : According to the author, many insurers are attempting
to rate physicians based on quality or costs measures without
the consent of physicians. For example, the California
Physician Performance Initiative (CPPI) is a physician rating
project based on national quality measures. The author writes
that CPPI has mainly focused on measuring primary care
physicians and internists, but it continues to expand to other
specialties, such as cardiologists, endocrinologists,
pulmonologists, gastroenterologists, and rheumatologists. The
author states that quality or physician rating programs, such as
the CPPI, are fraught with multiple problems, including
incompleteness of claims data, statistical validity of patient
sample size, and the likelihood of misleading patients due to
inaccurate information.
According to a March 2010 New England Journal of Medicine
article regarding physician cost profiling, health care
purchasers are experimenting with a variety of ways to control
costs; several of which involve physicians, since they often
write the orders that drive spending. Towards that end, health
plans have limited the number of physicians who receive
in-network contracts, offering patients differential copayments
to encourage them to visit "high-performance physicians" (i.e.,
those providing higher-quality, lower-cost services), paying
bonuses to physicians whose patterns of resource use are lower
than average, and publicly reporting the relative costs of
physicians' services.
Researchers from RAND, the University of Pittsburgh School of
Medicine, and the University of Southern Maine, Portland
examined claims data from four health plans in Massachusetts to
analyze programs offering incentives to choose physicians
classified as offering "lower-cost care." The stated intent was
to evaluate the reliability of current methods of physician cost
profiling. The researchers found that overall, the majority of
physicians did not have cost profiles that met common thresholds
of reliability. For example, 43% of all physicians sampled
(across specialties) were misclassified as lower cost, which
suggested to the researchers that there are serious threats to
health plans' abilities to achieve cost-control objectives and
to patient expectations of receiving lower-cost care when they
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change physicians for that purpose. The researchers concluded
that "Current methods for profiling physicians with respect to
costs of services may produce misleading results."
In 2007, the New York State Attorney General commenced an
industry-wide investigation into insurers' "doctor-ranking"
programs. As a result, settlement agreements were reached with
several health insurance companies, and out of those agreements
the Patient Charter for Physician Performance Measurement,
Reporting and Tiering Programs (Patient Charter) was created.
The Patient Charter, which is endorsed by the AARP, the National
Partnership for Women & Families, the AFL-CIO, the Leapfrog
Group, Pacific Business Group on Health, the National Business
Coalition, and several physician groups (including the American
Medical Association) creates a national set of principles to
guide measuring and reporting to consumers about doctors'
performance. As of March 10, 2010 six plans had committed to
fulfilling the Patient Charter: Aetna, Blue Cross Blue Shield of
Tennessee, Blue Shield of California, Cigna, UnitedHealthcare,
and Wellpoint.
According to the CPPI Web site, the initiative began in 2006 to
measure and report the quality of patient care that is provided
by individual physicians in California. The project is
administered by the California Cooperative Health Care Reporting
Initiative, a group that collaborates on quality issues, and
whose members include employer, consumer, health plan, and
physician groups. Start-up funding for CPPI was provided by the
federal Centers for Medicare and Medicaid Services, the
California HealthCare Foundation (CHCF), the Pacific Business
Group on Health, and the pharmaceutical company Merck.
According to CHCF, this multi-stakeholder initiative is
investigating how California physicians stack up against
benchmarks and whether care provided to Medicare beneficiaries
varies against other payers.
CPPI assessed physician performance using clinical quality
measures that are evidence-based and endorsed by national
standard-setting bodies (the National Quality Forum and the
American Medical Association's Physician Consortium on
Performance Improvement). According to CPPI, the measures for
2008 and 2009 were related to preventive care and chronic
condition management. For 2008 data, individual reports were
sent to over 13,000 physicians for their review and correction
over an eight-week period. Based on that review by physicians,
AB 2533
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a number of errors in the data were identified. Results were
not released publicly, and a November 2008 briefing on CPPI by
one of the partners noted that data improvements were needed in
the project moving forward.
The California Medical Association (CMA), the sponsor of this
bill, writes that many insurers and plans, and other third party
entities, are conducting physician quality ratings without the
knowledge or consent of physicians. CMA states that given that
there are many concerns about the accuracy of the claims data
used by insurers, and the irreparable harm such ratings may
bring to a physician's personal and professional reputation or
how patients could be mislead by the information, it believes
that health plans, insurers, or any third party contracted to
conduct a quality rating program should be required to simply
disclose a description of the policies and procedures related to
the rating.
Analysis Prepared by : Melanie Moreno / HEALTH / (916)
319-2097
FN: 0004204