Physician ratings process needs transparency

Health plans say they rate physicians so they can give their members a list of the doctors deemed most cost-efficient. Those doctors often end up in a tiered plan, where those members spend a lower co-pay for seeing them, or pay lower premiums if they stay away from physicians who aren't on the list.

Unfortunately, far too often, there are serious accuracy problems with the ratings.

A series of studies from the RAND Corp., funded partially by the Dept. of Labor and appearing in The New England Journal of Medicine and the Annals of Internal Medicine, has confirmed organized medicine's long-standing suspicion that health plans' cost rankings are seriously flawed. All in all, RAND called these ratings "not ready for prime time."

According to RAND's research, which was based on models that mimicked those used by major health plans, about 22% of physicians are assigned to the wrong cost category. Depending on the specialty, anywhere from 17% to 61% of doctors could be misclassified. In some cases, according to RAND, a physician could be called low-cost by one plan and high-cost by another.

These kinds of mistakes can have serious economic impacts on physicians, as they unfairly lose patients who are steered elsewhere by their plans. Despite this, health plans often don't reveal how their ratings were determined, making it difficult for doctors to challenge them.

Meanwhile, the joke is on patients who thought they were making informed and responsible decisions. The RAND data suggest that insurers also are playing tricks on themselves: They are failing to control costs as they hoped, because patients are being sent to "lower-cost" physicians who really don't fit that profile.

To get these ratings on the right track, the AMA and 46 state medical societies sent a letter to the chief executive and chief medical officers of the 47 health plans around the country. The letter demands that the plans work with organized medicine to formally re-evaluate what organized medicine called the plans' "Rube Goldbergesque" profiling programs.

The re-evaluation must include an external review and assessment to determine if they are reliable, a review of the plans' misclassification rates and a look at what might be needed to improve those rates. What organized medicine wants is a good, hard, dispassionate look at ratings to get inside why plans are so wrong, so often. The evidence of the problem goes beyond just the RAND research. The AMA and state medical societies letter cites three other studies, two of them in The American Journal of Managed Care and The Journal of the American Medical Association, that reach the conclusion that health insurers' quality or cost ratings for physicians are unreliable.

Major health plans and America's Health Insurance Plans, the plans' trade organization, have responded to that letter by saying that their programs are carefully established, that they believe in getting accurate results, and that they are qualified by National Committee for Quality Assurance's Physician-Hospital Quality Program, which certifies physician-profiling programs. However, the fact remains that RAND and others have found significant errors in multiple studies. A transparent system would resolve the matter concretely.

It's in everyone's interests that the ratings be correct. Instead, independent research has revealed problems, and the rating process largely remains a mystery -- hardly a confidence-building profile of a system that presumes to give guidance to patients and pass judgment on doctors.