Health plans that insure members of the Public Employee Benefit Board will have to take some responsibility for improving health outcomes next year, as the board moves to implement quality metrics similar to those used by the coordinated care organizations.
Under the plan, PEBB will hold back a portion of the funds it pays to its health insurers until they report on 15 quality metrics, and if they don’t show improvement, the insurers will forfeit some of that holdback.
“If they don’t meet those targets, those fees would be returned to PEBB,” explained PEBB staffer Margaret Smith-Isa to the board at its October meeting on Tuesday. The metrics will take effect in January, and then the reward money will be handed out at the end of the 2017 plan year.
PEBB staff outlined the benchmarks for everything from emergency room utilization and behavioral health screenings to preventive care and primary care home enrollment, generally opting for standards set by the CCOs for Medicaid or the 75th percentile for the privately insured nationally, whichever was stricter. The health indicators measured will be similar to those used by the Oregon Health Plan, but not the same, since PEBB serves a different population.
Instituting metrics for the PEBB health plans aligns the health delivery for public employees along the principles outlined by former Gov. John Kitzhaber, when he sought to expand the delivery transformation beyond the Oregon Health Plan with the new PEBB contract in 2014.
PEBB ultimately chose a hybrid approach with its new contract, contracting with three CCOs while also tasking private insurers Providence, Moda and Kaiser with running a more accountable insurance program.
This approach could potentially have more impact than housing PEBB within the tent of 16 CCOs, since it could lead the private insurers to spread the coordinated care reforms from the large state employee contract to the rest of the private market, including both individual health plans and employer-sponsored health plans.
Longtime PEBB board member Paul McKenna, who represents SEIU, questioned whether adopting a formula similar to the CCOs would be better than a more blended approach, which could reward absolute success rather than just progress.
The formula for the quality metric pool rewards continuous improvement rather than absolute success. If a health plan is already doing really well, it has less opportunity to be rewarded for improving, and could lose money simply from year-to-year fluctuations.
Meanwhile, a CCO or health plan that’s pulling up the rear gets rewarded for improving, even if it only improves from bad to poor.
McKenna worried that Kaiser Permanente in particular would be slighted by adopting a CCO-style quality bonus formula, since Kaiser was already performing above the benchmark on most measures, showing particularly high marks for prenatal care and the management of chronic diseases like hypertension and diabetes.
Smith-Isa told the board that each health plan would be given individual targets tailored to its existing performance.
The discrepancies in performance among the five discrete health plans that PEBB uses -- All-Care, Kaiser, Moda, Providence Choice and Providence statewide -- could be somewhat explained by differences in their customer base.
The small number of people All-Care covers partly accounts for its relatively poor numbers, giving a few sick or high-utilizing members more sway than with insurers that cover more people. Since it’s only been providing care to PEBB members for two years, it also would score lower on metrics such as colon screenings, since colonoscopies are only recommended every 10 years.
Moda Health is also a new player for PEBB and insures a much smaller portion of public employees than either Providence or Kaiser. Much of the data provided from Moda was actually from across its entire book of business, not just public employees.
Kaiser, on the other hand, with its closed network, may not be perceived as a good option to the higher-risk members, who would likely be choosier about specific physicians, and insist on the broader networks at Providence or Moda Health, which has partnered with Oregon Health & Science University.
