Health purchase partnership hits major impasse

Can it work in New Hampshire?

A nearly two-year effort by employers to peg the quality and efficiency of health care in New Hampshire with an aim at getting a handle on costs has gotten badly sidetracked following the withdrawal from discussions by Anthem Blue Cross Blue Shield of New Hampshire, the state’s largest health plan.

Anthem, expressing frustration over the management and design of a “tiered network” by the New Hampshire Healthcare Purchaser Partnership that would rank providers based on objective quality and cost/efficiency measures, pulled out last month from efforts aimed at planning the network. And the health insurer is not alone in voicing concerns over the management and design of the new health plan.

In a March 15 statement, Anthem said it “applauds the collaborative research and discussions” of the partnership and expressed several times its desire to see members of “the provider community in future discussions at the leadership level,” but is “declining the offer to build a new, tiered health insurance product.”

The partnership issued a statement later the same day alleging that Anthem was not “responding to employer and employee requests to control costs” by deciding no longer to help develop the strategy.

The partnership was created in early 2002 by a coalition of more than 50 public- and private-sector employers to develop a new model for health benefits. Guiding the partnership was a steering committee of employer representatives that eventually evolved into a more formal board of directors and a series of workgroups with the job of hammering out the details of the tiered product.

Conspicuously absent from leadership roles on both the board and the workgroups were representatives of the medical community and the state’s health insurers – and that was a glaring problem for Anthem and others in the state’s health-care medical community.

“We were looking for greater involvement from the provider community in the design of the metrics,” said Karen Brown, spokesperson for Anthem of New Hampshire.

According to James Weiss, superintendent of School Administrative Unit 17 in Sanborn and president of the partnership’s board, physicians, health plan representatives and other medical personnel were very much involved at the workgroup level, although the workgroups themselves were chaired exclusively by partnership members. “We had doctors from Dartmouth-Hitchcock, Wentworth-Douglass, the VA and Anthem. The quality workgroup also had medical, quality and administrative members from Concord Hospital.”

Other workgroups focused on plan design, consumer education, data repository, public relations/advocacy and cost/efficiency measures. The latter panel had been chaired by Joe D’Alessandro, former state personnel director and a member of the partnership’s steering committee. D’Alessandro resigned from his state post March 4 as a result of the attorney general’s investigation into how a state contract related to health benefits was awarded.

Rachel Rowe, a registered nurse and executive vice president of the Foundation for Healthy Communities, was a member of the quality measures workgroup. She also expressed concern that no physicians or health plan representatives were on the partnership’s board, adding that the process might “have worked better if payer and provider input was included at the decision-making level.”

“You need to have those stakeholders there to make decisions,” said Barbara Walters, medical director of Dartmouth-Hitchcock Medical Center and another quality measures workgroup member.

During initial development of the partnership, the provider community was receptive to exploring a new model for health-care reimbursement, said both Rowe and Palmer Jones, executive vice president of the New Hampshire Medical Society.

“The collaboration among the members that attended was fine, but it greatly diminished over time,” said Rowe.

Jones said that the seeming unwillingness of employer representatives to work around physicians’ schedules drove many doctors away from the table. Several of the practicing physicians he recommended for participation told him they found it difficult to attend most partnership meetings because they were held during the day, when most physicians are at work.

“We made it clear on two occasions — one in writing — that the meetings needed to be held at a time when physicians could attend,” said Jones. “The partnership didn’t change the times, so there wasn’t a lot of physician input because they couldn’t make it.”

Lack of communication?

Michael Bailit, a partnership board member , has created purchasing groups elsewhere around the country, as president of Wellesley, Mass.-based Bailit Health Purchasing. From his experience, he said, it does more harm than good to have broad representation in such a group.

“The NHHPP decided early on to exclude physicians and health plans from membership,” said Bailit. “In my experience, when there is a coalition represented by all, it has difficulty taking action along the lines with purchasers. Employer members often felt their own interests were not advanced.”

A group somewhat similar to the New Hampshire partnership, the Maine Healthcare Purchasing Collaborative — whose initial market research was conducted by Bailit Health Purchasing in 2000 — also does not have physicians or health plans are a part of the group.

“We are an employer advocacy group,” said Cathy Gavin, executive director. She describes the collaborative as a group supporting employers and value-based purchasing, “advocating on behalf of employers to the provider and managed care communities.”

But non-employer workgroup members have expressed other concerns about the direction in which the New Hampshire partnership was going.

Walters described a lack of communication between partnership leaders and the workgroups, which frustrated some members. “In the end, the organization seemed to fall apart. We [non-employer workgroup members] did not receive any feedback or updates from the steering committee,” said Walters.

“We were told at some point our quality group would merge with the efficiency workgroup; that didn’t happen. We were told that there would be some sort of provider advisory board created to receive information from the workgroups, and that was never formed.” She also said they were never informed about other workgroup actions or steering committee decisions. She also hadn’t been aware until told by a reporter that the steering committee had developed into a formal board of directors in February 2004.

Believing the initial design was completed, the partnership dissolved the workgroups last summer and began to draft a request for proposal. Both Walters and Rowe were told at that time they would be contacted regarding further developments. Neither has been contacted.

Rowe also said the scope and complexity of the required data, data collection methodologies and reporting seemed overwhelming to many of the non-employer members, particularly the physicians. “Outcomes would have to be measured over two, four, six months and we just don’t have those systems,” she said. “There’s a lot of work going on in this arena, but it’s just not ready to be used in a product. There are some big-numbers statistics, but we’re a small-numbers state, and you can’t always apply that kind of data. Fairly early on in the process, many of those key stakeholders either lost interest or lost confidence that anything meaningful would be achieved.”

After the workgroups were dissolved, Walters said, she felt little had been accomplished. “It was unclear what the endpoint was. We never finished the quality measures. We did look at some JCAHO measures (parameters used by the Joint Commission on Accreditation of Healthcare Organizations), but not individual provider or patient measures.”

‘Quite a blow’

It also is possible that the partnership’s RFP itself might have been to blame for such low health plan and physician participation — It was more of a request for commitment, than a proposal actively seeking specific information from prospective insurance partners. “It was unlike any RFP that I’ve ever written,” said Bailit. “We were really seeking a commitment to continue and complete the product design process.”

Bailit said the partnership and its workgroups collaborated for about a year in designing the general specifications of the product, and Anthem was by far the most engaged non-employer member.

In the summer of 2003, the purchasers felt they had enough initial data to bring insurers on board in the final design phase. They dissolved the workgroups – which were dwindling in the number of non-employer representatives at this time – and began development of the proposal, which was issued last October.

According to Bailit, three insurers – Anthem, CIGNA and Harvard Pilgrim — responded to the RFP. But, Weiss said, none of the three insurers gave a blanket agreement to the request. “No one responded the way we wanted,” he said.

Bailit said the partnership interpreted Anthem’s RFP response as “not a firm commitment, but that they would consider ongoing discussions of how the product should be constructed.” He said the purchasers were “troubled” by Anthem’s response.

Anthem’s departure – which Weiss said was “quite a blow” — has put the partnership’s plans on hold.

“It was our goal to have something by 2005,” said Weiss. “Obviously, we’re not ready. We’re reorganizing.” He said the partnership is looking to work with other insurance companies with a significant presence in the state.

Bailit said the group is in “active discussion” with CIGNA, “who is in the process of rolling out a product in several other states that looks similar to what we’re doing here.”