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Most employers review but do not use quality data when selecting health care plans

Despite the ever-increasing wealth of information available on health care quality, employers seldom use that information when selecting health benefits for their workers, according to a new study. Researchers conducted telephone interviews in 2005 and 2006 with 609 employers in 41 U.S. markets, representing about 78 percent of the U.S. metropolitan population.

Of the executives surveyed, 65 percent said they look at health plan quality data when choosing a plan for their employees. However, just 17 percent use that data to negotiate bonuses or penalties in plan contracts. Instead, geographic coverage and premium rates drove executives' decisionmaking 85 percent of the time.

One explanation for not using the data is employers do not see the business case of how value-based purchasing may affect productivity or workforce recruitment and retention. Another explanation offered is that large firms do not believe the benefits of value-based purchasing justify the cost of collecting the data.

Similarly, smaller employers are much less likely to aggregate quality data and develop a report card as a basis for choosing a plan. Large employers wield tremendous purchasing power, which can drive further quality improvements. Also, many small employers belong to purchasing coalitions, which may become the venue for distilling health care quality information for employer purchasers, note the study authors.

Employers do appear to be embracing health promotion in the workplace. Nearly half of all businesses surveyed provide screening, treatment, or disease management on site, and 70 percent provide clinical help lines.

This study was funded by the Agency for Healthcare Research and Quality (HS13335).

See "Employers' use of value-based purchasing strategies," Meredith B. Rosenthal, Ph.D., Bruce E. Landon, M.D. M.B.A., Sharon-Lise T. Normand, Ph.D., and others in the November 21, 2007, Journal of the American Medical Association 298(10), pp. 2281-2288.

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