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Life Health > Health Insurance > Health Insurance

NCQA: Low-Cost Plans Can Be Good Plans

By Allison Bell

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Offering credible, easy-to-understand health insurance quality indicators could be critical to efforts by the new health insurance exchanges to hold the cost of coverage down.

Officials at the National Committee for Quality Assurance (NCQA), Washington, make that case in a revised version of a presentation explaining to the National Association of Insurance Commissioners (NAIC), Kansas City, Mo., why the NCQA thinks providing PPACA compassquality data should be an important part of the exchange program that is supposed to be created by the Patient Protection and Affordable Care Act of 2010 (PPACA).

If PPACA takes effect as written and works as expected, exchanges are supposed to begin offering individual and small group policies that meet minimum federal value standards starting Jan. 1, 2014.

Consumers with incomes ranging from 133% to 400% of the federal poverty level will be able to use the exchanges to buy coverage using a new system of federal income tax credits, but the U.S. Department of Health and Human Services (HHS) says it will let states design the exchanges how they see fit.

The NAIC’s Exchanges Subgroup was going to hold a session in August at the association’s summer meeting in Philadelphia. NAIC canceled the meeting because of concerns about Hurricane Irene.

The subgroup is set to return to the topic Saturday, and the NAIC’s fall meeting in National Harbor, Md.

NCQA officials suggested in the original version of the exchange presentation that the exchange design effort is an opportunity for policymakers to use “choice architecture” to nudge consumers toward the health insurance options that offer the most bang for the buck.

Choice architecture could include strategies such as building portal displays that array cost and quality information together and providing decision-support tools that highlight quality as well as cost, NCQA officials.

In the new version of the presentation, NCQA officials again talk about the importance of choice architecture. They put more emphasis on the need for the kinds of formal quality measurement and accreditation programs that the NCQA providers.

“Accreditation is meaningful,” NCQA officials say. “[A] rigorous program can drive value.”

If no quality data are available from a comparison shopping website, “consumers high cost is a proxy for high quality,” the NCQA officials say. “If quality data are provided with cost [data], consumers will choose high-value (low-cost, high-quality) [options].”

The default options – including the default display options –matters, the NCQA officials say.

Consumers are more likely to use quality information in purchase decisions if the information is included automatically along with the cost information, the NCQA officials say.

Plans with about 118 million enrollees already are using the NCQA’s Healthcare Effectiveness Data and Information Set (HEDIS) format to report quality data, and 42 states already use or recognize NCQA health plan accreditation standards when administering public health insurance programs, the NCQA officials say.

The NCQA officials provide a graph showing that NCQA-accredited plans perform significantly better than other plans on indicators such as blood sugar control for people with diabetes and control of high blood pressure.

URAC, Washington – another health plan accreditation organization – notes in a presentation it has given the Exchanges Subgroup that it, too, is ready and able to accredit the health plans that want to participate in the new health insurance exchange programs.

Quality review programs are critical to making sure the plans sold deliver the services they have promised to provide, URAC officials say.

In the real world, URAC accreditation examiners have found, for example, a health plan that triggered 700 enrollee complaints in a month because it failed to verify whether providers were getting paid, and the providers stopped seeing the plan’s patients, URAC officials say.

In another case, a failure to meet utilization and medical necessity guidelines led to formulary problems that, in turn, led to the re-hospitalization of a premature baby, URAC officials say.

Three groups that say they speak for small employers – the Illinois Chamber of Commerce, Springfield, Ill.; the Association of Washington Business, Olympia, Wash.; and the Kentucky Chamber, Frankfort, Ky. – submitted a joint comment that gives eight principles for creating health insurance exchanges that can help small employers.

One is that existing insurance markets must continue to operate outside the exchange environment, a second is, “Do no harm to programs that are working,” and a third is that the exchanges should be independent bodies, not arms of existing state agencies.

“This ensures greater transparency and independent of the exchanges from some of the political influences that may otherwise conflict with the mission of the exchange,” the groups say.

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