Lessons learned from the experience of large purchasers may be applicable to the Health Care Financing Administration (HCFA), the nation’s single largest payer for health care. Need to Monitor Quality of Care

With increased use of managed care, public and private purchasers must consider strategies to monitor plans and ensure the quality of the care they provide. Specifically, we agreed to describe (1) how large purchasers use quality-related data to seek or promote better quality of care and (2) lessons that can be learned from their experiences for HCFA in administering the Medicare program. After applying financial penalties, one purchaser said it achieved improvements in employee satisfaction. They use the data to select plans, monitor changes in performance over time, and establish benchmarks and minimum standards. As a result, HCFA will now begin to look more like purchasers that enroll most of their employees in managed care and those that provide comparative information on health plans to their employees as well as use quality-related data to prompt health plans to improve their performance. The experiences of purchasers we visited have implications for HCFA in three ways: (1) educating beneficiaries as to the meaning of quality-related measures when providing comparative information on health plan quality; (2) interacting with health plans to take action, either through a collaborative- or a compliance-oriented approach, when problems with health plan performance are surfaced by quality-related data; and (3) continually looking for additional opportunities to make use of quality-related data. The structure of the Medicare program, unlike private sector care, is determined by law and regulation. — Ensure provider choice and access. — Improve health plan quality and service.
Why GAO Did This Study

Pursuant to a congressional request, GAO determined how large purchasers use quality-related data to seek or promote better quality of care and lessons that can be learned from their experiences for the Health Care Financing Administration (HCFA).

What GAO Found

GAO noted that: (1) after collecting and making use of quality-related data, the purchasers GAO studied reported that in addition to cost savings, they saw improvements in access to care and health plan services, as well as in employee satisfaction with health plan performance; (2) they realized such improvement by identifying opportunities to use quality-related data in selecting health plans, monitoring health plan performance, developing quality improvement initiatives with plans and taking other actions, and providing information on health plans to their employees; (3) while HCFA is a unique purchaser of managed care--by virtue of the size of the Medicare program and the freedom of choice provided to beneficiaries--a number of private purchasers' quality of care strategies could be relevant to HCFA's administration of the Medicare program; and (4) major lessons from large purchasers' experiences relate to the importance of: (a) educating employees as to the meaning of quality-related measures when providing comparative information on health plan quality; (b) using collaborative- and compliance-oriented approaches to achieve improvements in plan performance; and (c) continually looking for additional opportunities to make use of quality-related data, such as developing standards and benchmarks for plan performance.